Victoria will receive a $3.7 billion increase in its GST distribution because of its reduced capacity to raise mining revenue relative to other states, as well as data revisions as its urban population and urban density increased.
Western Australia's GST distribution will increase by $6.2 billion despite strong iron ore royalties because of an increase in the so-called GST relativity floor to 0.75 in 2024-25 from 0.7 a year earlier.
The "floor" is intended to make sure WA is not disadvantaged in providing services compared to fiscally stronger NSW and Victoria.
"The Commonwealth government's top-up to the GST pool and no worse off payments ameliorate this impact," the commission said.
All states, other than NSW and Queensland, were estimated to receive more in total GST and "no worse off payments" than they received in 2023/24.
The federal government distributes revenue from the GST tax take to put state governments in a position to provide their residents with comparable services.
It is the job of the commission to advise how it should be shared, assuming each state makes a similar effort to raise revenue from its own taxes and royalties.
Rising commodity prices have had a big influence on the value of mining activity and the revenue-raising capacity of NSW, Queensland and WA in recent years, according to the commission.
Coal royalties were the largest component of the mining revenue assessment in the latest update because of an increase in coal prices and the national average coal royalty rate.
This led to a reduction in the assessed GST needs of NSW and Queensland and an increase in the assessed GST needs of other states, including a significant increase for Victoria, the commission said.
Similarly, other mineral royalties continued to grow, with lithium royalties rising to over $1 billion while onshore oil and gas exceeded $2 billion.
