In parliament yesterday, the Opposition grilled the Treasurer as it continued to attempt to drive a wedge between Jay Weatherill and his party on a GST campaign now universally considered defunct.
On Tuesday, Koutsantonis would not explicitly endorse a GST rise, instead saying he agreed with the Premier’s “tactics”.
His office reacted angrily to InDaily’s report of the exchange yesterday, insisting the Treasurer “has publicly stated his support for the Premier’s position – and advocated that position at a national level”.
But for the second successive day, Koutsantonis refused to explicitly endorse a GST increase. Asked by Liberal leader Steven Marshall if he “personally believes that we should have a GST rate of 15 per cent”, Koutsantonis said: “I supported the Premier’s plan.”
“I argued for that plan at the Treasurers’ conference,” he said.
“I argued for that plan, and the plan was inspired, if I can say so myself; it was a very good plan.”
Weatherill had proposed increasing the GST to 15 per cent, with the Commonwealth pocketing the proceeds, on the proviso the states “would cash in our national partnership payments and our special purpose payments and receive a portion of income tax”.
“Why? Because income tax is the one tax that grows at the same rate as the economy and roughly the same rate as healthcare costs – a much more stable way for states to fund expenditure,” Koutsantonis told parliament.
“We argued for that plan [but] now the Prime Minister has walked away from it. He says he does not want that plan. Well, that means that the Opposition and the Commonwealth Government need to solve this problem. How do we fund our hospitals? How do we fund our schools?”
The Premier yesterday reignited a concerted campaign against Commonwealth cuts to future health and education spending, while maintaining he would push for a share of income tax receipts and a broadening of the GST to include financial services.
His Government is on sensitive ground on the consumption tax argument, with both Weatherill and Koutsantonis previously denouncing the tax as “regressive”, and Labor insiders long expressing scepticism about the Turnbull Government publicly advocating a GST increase.
Asked yesterday why he had told parliament last July that he and Labor would not support a GST rise, Koutsantonis suggested the backflip was forced by economic realities.
“Unfortunately for members opposite, they have very little experience in governing,” he said.
“Governing means that sometimes, when you are confronted with the size of the fiscal gap that we have, we need to be responsible.
“When a successful Liberal like Mike Baird stands up and has the courage to say, ‘Let’s have a debate about taxation in this country’, we were not prepared as a Government to let him sit on his own, so we stood with him.”
The Treasurer insisted that “despite the Opposition attempting to say that there is somehow a different position from his cabinet to the Premier’s, I can assure the house that everyone is in lockstep behind our Premier”.
“This party has a proud history of supporting our leaders – that is why we can boast two leaders in 25 years,” he said.
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