WHAT IS WA'S GST DEAL?
* As of 2018, a floor was put in place to ensure all states are guaranteed at least 75% of Goods and Services Tax revenue if it were to be divided by population.
* This means that for every dollar a state provides to the scheme, they are guaranteed to receive 75 cents back.
* Despite pressure for reform from eastern states and a Productivity Commission report calling the system 'unfair', Anthony Albanese has declared he will not change the deal.
*The current deal was created after WA received historic lows of less than 30c for every dollar paid into the scheme.
* Horizontal Fiscal Equalisation (HFE) is a system where states with high revenue from royalties, like WA's high mining royalties, are assessed as having a greater ability to fund services themselves so receive less revenue from GST.
* HFE is still in place across the GST system, although with significant reform after the 2018 deal between then-Prime Minister Scott Morrison and the WA government.
* A no-worse-off guarantee was put in place ensuring states that were disadvantaged by WA's greater share would receive federal government top up payments directly from the general federal reserve.
* From this current year, a second floor means no state is allowed to receive less than the percentage share of whoever is stronger out of NSW or Victoria.
WHY HAS IT BECOME SUCH A PROBLEM?
* The scheme was expected to cost around $2.3 billion but had blown out to $23 billion by 2024 and is due to cost $60 billion by the end of the decade.
* The federal government gave Western Australia a guaranteed minimum share of the GST pool regardless of its actual revenue needs.
* NSW receives just 82 cents for every dollar paid into the GST, all without the significant mining royalties to assist in the state's revenue stream.
* Similarly, other states without the plentiful natural resources now have more of a financial burden than before the 2018 deal was made.
WHAT ARE PEOPLE SAYING ABOUT THE SITUATION?
* "WA is a major driver of our national economy, and they deserve their fair share of the GST," Anthony Albanese said. "I've said it multiple times. I've signed people's body parts, for goodness sake."
* "We're now in a situation where Western Australia is so wealthy and so rich that they're competing and bidding on NSW rugby league games," NSW Premier Chris Minns said. "You're seeing similar behaviour from Gulf states like Saudi Arabia and the UAE and Dubai."
* "Jim Chalmers now has a clear choice: he can continue to defend a broken system or finally stick up for his home state and the national interest," Queensland treasurer David Janetzki said earlier in August.
*"The changes would punish WA for its success simply to prop up other lazy states," WA Premier Roger Cook told reporters when changes to the deal were proposed last week.
Australian Associated Press