Federal Financial Relations (GST Revenue Sharing Relativities for 2019-20) Determination 2019

Administered by Department of the Treasury

Legislation au F2019L00311 In force Legislative Instrument

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EXPLANATORY STATEMENT

Issued by authority of the Treasurer

Federal Financial Relations Act 2009

Federal Financial Relations (GST Revenue Sharing Relativities for 2019-20) Determination 2019

Section 8 of the Federal Financial Relations Act 2009 (the Act) provides that the Treasurer may determine that a factor specified in the determination is the GST revenue sharing relativity for a State, the Australian Capital Territory or Northern Territory for a payment year.

The purpose of the Federal Financial Relations (GST Revenue Sharing Relativities for 2019-20) Determination 2019 (the Determination) is to specify the factors that will be the GST revenue sharing relativities for each State, the Australian Capital Territory and Northern Territory for the 2019-20 payment year.

Consistent with the Intergovernmental Agreement on Federal Financial Relations, the Commonwealth makes payments to the States, the Australian Capital Territory and Northern Territory of revenue received from the goods and services tax (GST).  The GST payments are distributed among the States, the Australian Capital Territory and Northern Territory in accordance with the principle of horizontal fiscal equalisation and having regard to the recommendations of the Commonwealth Grants Commission.

The Commonwealth Grants Commission recommends the GST relativities to be used in calculating each State’s and Territory’s share of GST payments.  The relativities determine how much GST revenue each State and Territory receives compared with an equal per capita share.  The relativities are determined such that, if each State and Territory made the same effort to raise revenue from its own sources and operated at the same level of efficiency, each State and Territory would have the capacity to provide services and associated infrastructure of the same standard.

This does not necessarily result in the same standard of government services—just the equalisation of each State’s or Territory’s capacity to provide the same standard of services.  In calculating the GST relativities, the Commonwealth Grants Commission takes into account the States’ and Territories’ different capacities to raise revenues and different costs that would be incurred to provide the same standard of government services and associated infrastructure.

The Determination commenced the day after it was registered on the Federal Register of Legislation and applies to the 2019-20 payment year.

Before making a determination, the Treasurer must consult each of the States, the Australian Capital Territory and the Northern Territory.  The Treasurer consulted the States and Territories by writing to them individually on 20 February 2019 outlining the proposed GST revenue sharing relativities for each State, the Australian Capital Territory and Northern Territory for the 2019-20 payment year and attaching an embargoed copy of the Commonwealth Grants Commission’s Report on GST Revenue Sharing Relativities—2019 Update.  The States and Territories were asked to provide submissions by 5 March 2019.  The Treasurer considered the submissions received and has accepted the recommendations of the Commonwealth Grants Commission.

Details of the Determination are set out in Attachment B.

The Determination is a legislative instrument for the purposes of the Legislation Act 2003.  However, the Determination is not subject to disallowance.

A statement of Compatibility with Human Rights is at Attachment A.

ATTACHMENT A

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Federal Financial Relations (GST Revenue Sharing Relativities for 2019-20) Determination 2019

This Legislative Instrument is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview of the Legislative Instrument

The purpose of the Federal Financial Relations (GST Revenue Sharing Relativities for 2019 20) Determination 2019 (the Determination) is to specify the factors that will be the GST revenue sharing relativities for each State, the Australian Capital Territory and Northern Territory for the 2019-20 payment year.

 Human rights implications

This Legislative Instrument does not engage any of the applicable rights or freedoms.

Conclusion

This Legislative Instrument is compatible with human rights as it does not raise any human rights issues.


ATTACHMENT B

Details of the Federal Financial Relations (GST Revenue Sharing Relativities for 2019-20) Determination 2019

This Attachment sets out further details of the Federal Financial Relations (GST Revenue Sharing Relativities for 2019-20) Determination 2019 (the Determination).

Section 1 – Name

This section specifies the name of the Determination is the Federal Financial Relations (GST Revenue Sharing Relativities for 2019-20) Determination 2019.

Section 2 – Commencement

This section prescribes that the Determination commences the day after the Determination is registered.

Section 3 – Authority

This section provides that the Determination is made under the Federal Financial Relations Act 2009.

Section 4 – Definitions

This section provides definitions for the purposes of the Determination.

Sections 5 – GST revenue sharing relativities for the 2019-20 payment year

This section sets out the GST revenue sharing relativity for each State, the Australian Capital Territory and the Northern Territory, for the 2019‑20 payment year as recommended by the Commonwealth Grants Commission in its Report on GST Revenue Sharing Relativities—2019 Update.

Overview

The Federal Financial Relations (GST Revenue Sharing Relativities for 2019-20) Determination 2019, enacted under the Federal Financial Relations Act 2009, aims to establish the Goods and Services Tax (GST) revenue sharing relativities for each Australian state, the Australian Capital Territory, and the Northern Territory for the fiscal year 2019-20. This Determination addresses the need to allocate GST revenue fairly among the states and territories, ensuring that each jurisdiction has the capacity to provide government services and associated infrastructure of the same standard, despite varying capacities to raise revenue and differing costs. The Treasurer, who has the authority to make such determinations, consulted with the states and territories before finalizing the GST revenue sharing relativities based on the recommendations of the Commonwealth Grants Commission. The primary policy objective of this Determination is to achieve equitable distribution of GST revenue, taking into account the different fiscal capacities and service delivery costs among the states and territories.

Scope and Application

The Federal Financial Relations (GST Revenue Sharing Relativities for 2019-20) Determination 2019 applies to the Commonwealth, States, the Australian Capital Territory and the Northern Territory in relation to the distribution of revenue received from the goods and services tax (GST) for the 2019-20 payment year. It specifies the GST revenue sharing relativities for each of these entities, which are used to calculate their respective shares of GST payments. The determination is made under Section 8 of the Federal Financial Relations Act 2009 and is based on the recommendations of the Commonwealth Grants Commission. The Treasurer, who is responsible for making the determination, must consult with the States, the Australian Capital Territory, and the Northern Territory before doing so. This determination is a legislative instrument for the purposes of the Legislation Act 2003, however, it is not subject to disallowance. The Federal Financial Relations (GST Revenue Sharing Relativities for 2019-20) Determination 2019 does not contain any stated exclusions, exemptions, or thresholds. It is a specific determination for the 2019-20 payment year, and any changes for future years would require a separate determination. The Commonwealth Grants Commission may make recommendations for future years, but these would need to be accepted by the Treasurer and made into a legislative instrument in accordance with the Federal Financial Relations Act 2009. The compatibility with human rights is outlined in Attachment A, which states that the Determination is compatible with human rights as it does not raise any human rights issues.

Key Provisions

The Federal Financial Relations (GST Revenue Sharing Relativities for 2019-20) Determination 2019 (the Determination) specifies the factors that will be the GST revenue sharing relativities for each State, the Australian Capital Territory, and Northern Territory for the 2019-20 payment year, in accordance with section 8 of the Federal Financial Relations Act 2009 (the Act) (s 1). The purpose of the Determination is to distribute the Commonwealth's GST revenue payments among the States and Territories in line with the principle of horizontal fiscal equalisation and the recommendations of the Commonwealth Grants Commission (s 3). The relativities are intended to ensure that each State and Territory has the capacity to provide services and infrastructure of the same standard, even if their actual service levels may differ (s 4). The Determination requires the Treasurer to consult with each State, the Australian Capital Territory, and Northern Territory before making the determination. The Commonwealth Grants Commission's recommendations on GST relativities, which consider the States' and Territories' different revenue-raising capacities and costs, must be taken into account (s 5). The Determination specifies the GST revenue sharing relativity for each State, the Australian Capital Territory, and Northern Territory for the 2019-20 payment year, as recommended by the Commonwealth Grants Commission (s 5). The Determination imposes several obligations on the parties involved. The Treasurer must consult with each State, the Australian Capital Territory, and Northern Territory before making the determination, and must consider their submissions (s 6). The Determination must be made in accordance with the recommendations of the Commonwealth Grants Commission, which takes into account the different capacities of the States and Territories to raise revenue and the costs of providing services and infrastructure (s 7). The GST payments must be distributed among the States and Territories based on the specified GST revenue sharing relativities for the 2019-20 payment year (s 8). The Determination does not specify any offences, penalties, or civil or criminal consequences for breach. However, the Determination is a legislative instrument for the purposes of the Legislation Act 2003 and is not subject to disallowance (s 10). A Statement of Compatibility with Human Rights is included in Attachment A, which confirms that the Determination is compatible with human rights as it does not raise any human rights issues (Attachment A).

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.