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2021 Update

On 15 March 2021, the Commission published its recommended relativities for distributing the GST among the states and territories in 2021-22. The final report is now available, with a range of supporting information.

The relativities for 2021-22 were produced in accordance with the Commonwealth’s new equalisation arrangements enacted in the Treasury Laws Amendment (Making Sure Every State and Territory Gets Their Fair Share of GST) Act 2018.

 

Research Papers

An important feature of Australia’s federation is that the Commonwealth provides untied financial support to the states and territories.

This allocation of GST revenue reflects their different needs and is known as horizontal fiscal equalisation. Read about it in the latest research paper

The Commission's Research Papers provide further detail on the topical and background issues associated with horizontal fiscal equalisation, the distribution of the GST pool, and the role of the Commission.

Who We Are

Operating under the Commonwealth Grants Commission Act 1973, we are a small independent statutory authority responsible for measuring the relative fiscal capacity of the States and Territories. The CGC is:

- A Commission which makes decisions about how to measure the relative fiscal capacities of the States

- An agency that is responsible for collecting and assessing data, and undertaking research to provide considered advice to the Commission.

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Fiscal Equalisation

Fiscal equalisation makes it possible for every State and Territory to provide similar standards of service (e.g. hospitals, education, social housing, transport and policing) with comparable levels of taxation, whilst allowing the benefits of decentralised governance and administration to be retained.

Some form of equalisation has been in place in Australia since Federation to address both the vertical fiscal imbalance between the States and the Commonwealth, and differences in fiscal capacities across States.

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