Review of Western Australian State Taxes 1994 - Chapter Nine - Federal-State Financial Relations
AbstractThe Chapter discusses the current system of inter-governmental financial arrangements -- i.e. grants given to the States by the Commonwealth Government -- and their impact on taxation policy. It sets out the rationale for the arrangements, the way in which grants are distributed and their operation in the federal system. The authors find that the taxation policy objectives at State level are affected by the principle of fiscal equalisation underlying the current scheme, and by legal and political realities faced by the State. The Chapter concludes that the present difficulties may be alleviated somewhat if the Commonwealth allowed the States greater access to tax revenue. |