Victorians are the big winners from the latest carve-up of GST revenue, but their gains will come at the expense of Queenslanders.

Every jurisdiction but the Sunshine State will get a financial boost from the GST after the Commonwealth Grants Commission handed down its latest report into how the tax proceeds will be divided up in the new financial year.

Victoria will get an extra $3.6 billion from the GST, due to its booming population and being less reliant on royalties from mining.

NSW will gain a further $942 million to the state’s coffers, with Western Australia also getting $395 million extra for 2025/26.

However, Queensland will get $1.2 billion less from the latest carve-up compared to the previous year.

“This is largely because higher coal prices and a higher average coal royalty rate significantly increased its capacity to raise revenue from coal royalties,” the commission said in its report.

Commonwealth Grants Commission chair Mike Callaghan said Queensland’s mining boom had also contributed to the reduction.

“Queensland has had the largest amount of coking coal,” he said on Friday.

“If a state has a growth in revenue, it doesn’t need as much as GST distributed.

“Mining states going through a mining boom results in a reduction with their GST and because it’s a fixed pool, those states that don’t have any get extra.”

But Queensland Treasurer David Janetzki said the state was not getting its fair share of the money.

“This recommendation would severely compromise Queensland’s capacity to deliver essential services and infrastructure for our growing state,” he said.

“This must be called out for what it is, shonky shifting of Queenslanders’ money for a better payout for NSW and Victoria.”

Janetzki wants federal Treasurer Jim Chalmers to reject the commission’s recommendations, saying Queensland had the biggest reduction in revenue since the GST was introduced in 2000.

Assessments for GST funding are done through a rolling three-year average, with Covid lockdown years now being excluded from calculations.

Callaghan said the downturn in Victoria during the pandemic had dropped out of assessments and a subsequent population rise meant the state’s GST share needed a boost

“If there is a significant increase in GST need, and other states have a fall, everything in the GST is relative,” he said.

The carve-up frequently comes under fiery criticism from state and territory leaders.

Labor leaders in the two most populous states got stuck into a war of words with each other in 2024 when NSW Premier Chris Minns described Victoria as a “welfare state”.

Then Victorian treasurer Tim Pallas returned fire, claiming Minns did not understand the GST system.

It’s also a major talking point in resource-heavy WA, which enjoyed a boost in 2018 under the Coalition.

Prime Minister Anthony Albanese vowed not to change the arrangement in the west. In February 2024, he even signed the promise onto the arm of a journalist while visiting Perth.

NSW and Victoria have want a per-capita distribution while Queensland’s former deputy premier Cameron Dick hit out at the commission’s decision to examine how coal royalty revenue was calculated.

States and territories rely on GST for help funding major expenditure including health, education, infrastructure and housing.

-AAP