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GST hike not for discussion: Swan


Federal Treasurer Wayne Swan says a hike in the GST will not be on the agenda when he meets his state and territory counterparts in Canberra on Monday.

The Standing Council on Federal Financial Relations is expected to discuss a review of GST, led by former premiers Nick Greiner and John Brumby, along with stamp duty on home sales.

But Mr Swan ruled out any discussion about lifting the rate of the GST above 10 per cent or broadening its base to include fresh food or health costs, branding it a "lazy way" of going about tax reform.

"From this Labor government's perspective, we will never consider increasing the rate or the base of the GST," he told reporters in Canberra on Monday.

"Doing that would hit the lowest income earners in our community really hard."

The Greiner/Brumby review was not allowed to consider a hike in the GST or extending its base under the government's terms of reference.

Mr Swan said a number of Liberal state treasurers had been encouraged to raise the issue by shadow treasurer Joe Hockey.

He urged the states to reform their own taxation regimes and they could start by getting rid of stamp duty.

NSW Treasurer Mike Baird said it was disappointing Mr Swan had ruled out discussing a GST hike before even sitting down with state treasurers.

"It seems to me ... he either hasn't read his papers, he's interested in conspiracy theories or he's not interested in any way, shape or form in dealing with tax reform," he told reporters.

NSW supported the recommendation in the tax review suggesting GST revenue be distributed to the states on an earnings per capita basis.

Mr Baird said that system had broad support across the states because it would be fairer, more transparent and reduce volatility.

The suggestion that Mr Hockey had urged state Liberal treasurers to raise the issue of hiking the GST with Mr Swan was "complete and utter nonsense".

"I would expect more from a federal treasurer in terms of dealing of matters of state and national interest," he said.

West Australian Treasurer Troy Buswell says the failure to discuss the GST fully is a lost opportunity for Australia.

"States are keen to look at more efficient, more effective taxation systems ... but they can't do it alone," he told reporters in Canberra.

Mr Buswell said the GST review and the earlier Henry review of taxation had been hamstrung by the parameters set by the federal government.

They were clearly designed to stymie any attempt to come up with meaningful reform, he said.

In a proposal to the Henry review, WA canvassed a more streamlined taxation system that included looking at the rate and base of the GST and doing away with inefficient state taxes.

"That was never given any serious thought," Mr Buswell said.

On mining royalties, WA was comfortable with the existing position despite a recommendation from the OECD they be dumped and replaced with a uniform resources rent tax.

Queensland Treasurer Tim Nicholls said Mr Swan's view that the states should do the heavy lifting on tax reform was not helpful.

"Just pulling down the shutters and saying `No we can't help' doesn't assist the case," Mr Nicholls told reporters.

"Stamp duties on commercial and residential property are one of the bigger earners for the states and any reduction in those would result in benefits for the commonwealth."

Victorian Treasurer Kim Wells said his state colleagues had come to Canberra in good faith and he was disappointed by Mr Swan's misleading comments.

"It's a ridiculous start to this meeting," he told reporters.

"For him to come out this morning and say the Liberal treasurers are arguing for an increase and broadening the base of the GST is simply incorrect."

Victoria did not support an increase in the GST rate or any move to broaden its base.

Mr Wells ruled out "slugging" Victorian family homes with land tax.