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Budget Paper No.2 Fiscal and Economic Outlook 2008-2009



Budget Paper No.2 Fiscal and Economic Outlook 2008-2009

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Tabled paper 1293


Tabled papers for 10th Assembly 2005 - 2008; Tabled Papers for 10th Assembly 2005 - 2008; Tabled papers; ParliamentNT; Tabled Papers




Tabled By Delia Lawrie


Made available by the Legislative Assembly of the Northern Territory under Standing Order 240. Where copyright subsists with a third party it remains with the original owner and permission may be required to reuse the material.




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2008-09 Budget 60 Territory Own-Source Revenue The ability of the states to generate revenue from their own sources is a result of the size of each jurisdictions revenue base and the tax rates the government applies. The Commonwealth Grants Commission (the Commission) assesses each jurisdictions revenue capacity and revenue effort when calculating goods and services tax (GST) shares. Revenue capacity is the per capita revenue a state could raise by applying national average rates to its own revenue base, whereas revenue effort is whether state taxes are applied at levels above or below the national average level. Average revenue capacity and effort are assumed to be 100 per cent. If a state has an above average revenue effort or capacity it will score more than 100 per cent, while below average capacity or effort is less than 100 per cent. The most recent data used by the Commission to assess revenue capacity and effort is 2006-07 data. Table 6.1 compares own-source revenue capacity in all jurisdictions and shows that capacity varies significantly between jurisdictions, with the Territorys capacity below average but higher than four other jurisdictions. NSW Vic Qld WA SA Tas ACT NT 101 87 108 141 78 68 85 90 Source: Commonwealth Grants Commission 2008 Update Table 6.2 provides a comparison of the Commissions assessment of own-source revenue-raising effort in 2006-07 and includes taxation, mining revenue and contributions by trading enterprises, including government owned corporations. Own-source revenue effort shows less divergence between jurisdictions than revenue capacity. The assessment in Table 6.2 shows that the Northern Territorys own-source revenue-raising effort is below the national average and the second lowest of all the states. NSW Vic Qld WA SA Tas ACT NT 104 103 85 105 111 101 110 96 Source: Commonwealth Grants Commission 2008 Update Assessments of Revenue Effort and Capacity Table 6.1: 200607 Revenue Capacity by Jurisdiction Total OwnSource Revenue Table 6.2: 200607 Revenue Effort by Jurisdiction Total OwnSource Revenue