Local News

GST report extremely concerning: NT

nicole manison

The Northern Territory government has slammed proposed changes to the GST distribution system as a "cynical cash grab" from Canberra and vowed to fight for a better deal.

Treasurer Nicole Manison says if the Productivity Commission's draft recommendations were adopted, significantly more GST funding would be stripped from the Territory.

This would permanently reduce the standard of critical services and infrastructure for Territorians and widen the gap of Aboriginal disadvantage, she said.

"What the report is actually saying is Australia could boost economic efficiency if the Australian government didn't have to bother about treating all Australians equally," Ms Manison said.

"The poor jurisdictions would get poorer, and the richer states would get richer."

In response to criticisms of Labor's funding prioritising urban areas over the bush, Ms Manison said about 50 per cent of NT government expenditure goes to indigenous Territorians, who represent about 30 per cent of the population.

The commission found the present system means states and territories have a disincentive to make the most of the resources and minerals they have.

The coalition is putting increasing pressure on the Gunner government to end its fracking moratorium, but Ms Manison reiterated it would remain pending the findings of an independent inquiry due at the end of the year.

She labelled it "outrageous" that her federal counterpart Scott Morrison suggested states should be penalised through GST if they ban the gas extraction method.

Labor will provide a written submission to the Productivity Commission, as will the Country Liberals Party.

Opposition Leader Gary Higgins also urged the Productivity Commission to conduct hearings in the NT, claiming the north is being ignored.

"At the same time, they are able to hold two public hearings in WA," he said.

Mr Higgins said while there are scenarios where the NT actually gains out of GST reform, there are still devastating potential consequences if GST moves to a per capita basis.

"The Territory has the most to lose out of any change to the current GST distribution," he said.