South Australia is bracing for further write-downs in GST revenues to the states in the upcoming economic statement from the federal government.
State Treasurer Rob Lucas says after the surge in coronavirus cases in Victoria in recent weeks Australia’s economic outlook is likely to have deteriorated.
“I suspect when the previous estimates were being done it was on the basis that restrictions were being eased,” Mr Lucas said.
“Given the significant reversal in Victoria and given the size and importance of Victoria to the national economy, sadly, I suspect when we see the GST estimates, we’ll see a further downgrade.”
Mr Lucas said lower returns would impact on the state budget which is due to be delivered in November.
“Now, hopefully between now and November, Victoria gets a hold on COVID-19 and hopefully the rest of Australia doesn’t suffer a second wave,” he said.
“But there are a lot of hopefuls here.”
Federal Treasurer Josh Frydenberg will deliver the government’s economic and fiscal update on Thursday and has warned Australians to be prepared for “eye-watering” numbers around debt and deficits.