What If WA Went It Alone? A Thought Experiment

Why ask the question?

West Australians have asked it before. In 1933 nearly two in three voters said yes to leaving the federation. Today the question is less about flags and more about money and decisions: how much WA puts into the federation, what comes back, and who gets to decide how it is spent. Here is what the public figures say, what they don't, and the hurdles any honest answer has to face.

1. What WA puts in, and what comes back

• WA's net contribution. WA Treasury estimates the Commonwealth raised about $112 billion from WA in 2023-24 and spent about $73 billion for WA's benefit, including WA's share of the federal deficit. That is a net contribution of about $39.0 billion, or about $13,324 per West Australian. On the same measure NSW contributed about $712 per person, while Victoria, Queensland, SA, Tasmania and the NT received more than they put in. (WA Government submission to the 2026 Productivity Commission GST inquiry, Table 1.12)
• GST per person. In 2026-27 WA receives about $2,990 per person in GST, against $3,858 in Victoria, $4,959 in SA and $6,869 in Tasmania. WA has about 11.1% of the population (CGC's 2026-27 estimate) and gets about 9.1% of the pool ($9.337 billion). (Commonwealth Grants Commission, 2026 Update, "Data on the recommended 2026-27 GST distribution" table; CGC media release, 13 March 2026)
• The 2018 deal matters, and it helps WA. The CGC estimates the 2018 GST changes are worth about $6.6 billion to WA in 2026-27 compared with the old system. Even so, the WA Government says WA still subsidises other states by about $2.5 billion a year compared with a population share. (CGC Guide to the 2026-27 GST distribution; WA Government submission)
• Least reliant on Canberra. Commonwealth grants made up about 31% of WA government revenue over the last decade, against at least 40% for every other state. (WA Government submission)

A fair reading: WA is the biggest net contributor per person, even with the 2018 deal. That number is a starting point for a debate, not a promised tax cut.

2. What a WA budget could look like

A WA that kept the Commonwealth revenue raised here would also have to pay for everything Canberra does here. A rough, transparent sketch:

• Revenue kept: about $112 billion a year in Commonwealth revenue raised from WA (WA Treasury, 2023-24, source).
• Commonwealth spending to take over: about $73 billion spent for WA's benefit in the same year (same source).
• Difference on paper: $112 billion minus $73 billion = about $39 billion.

What would WA have to fund itself? One way to gauge it is to take the Commonwealth's national spending by function and apply WA's population share in the same year, about 10.9% (about 2.97 million of 27.2 million people at 30 June 2024, ABS). This is a simple per-person share, not a costing; WA's real needs could be higher or lower.

National figures: Commonwealth Final Budget Outcome 2023-24, Appendix A, Table A.1 (actual outcomes for the same year as the WA Treasury figures).

Things the arithmetic leaves out, honestly stated:

• The table uses the same year as WA Treasury's estimate (2023-24), but it measures national spending by function, which is not the same thing as WA Treasury's estimate of spending for WA's benefit, so the two should not be subtracted from each other.
• A large part of the revenue raised in WA is company tax from mining, which rises and falls with iron ore prices, and much of it is paid by companies and shareholders rather than WA households.
• WA Treasury's figure includes a share of the federal deficit. A new country would also have to decide what share of national debt it takes on, and set up its own tax office, defence force, customs and border service, diplomatic network and central bank. We have not found a published costing of those start-up and running costs for WA.
• Defence for a large coastline is not a straight population share. Neither is the age pension, which depends on WA's age mix.

So the honest answer is: on paper WA raises more than is spent on it, but no published source turns that into a reliable figure for how much less tax each West Australian would pay.

3. The 1933 secession referendum

• On 8 April 1933, alongside the state election, West Australians were asked whether WA should withdraw from the federation. 138,653 voted yes (66.2%) and 70,706 voted no (33.8%). A second question, for a constitutional convention of the states, was rejected 119,031 to 88,275. (Musgrave, "The Western Australian Secessionist Movement", Macquarie Law Journal, 2003; WA Electoral Commission)
• Every electorate voted yes except the gold-mining districts. (Musgrave, Macquarie Law Journal, 2003)
• The new Collier Government, which had opposed secession, still passed the Secession Act 1934 and sent a delegation to London. The petition was presented to the UK Parliament in November 1934. (Musgrave, Macquarie Law Journal, 2003)
• A joint select committee of the UK Parliament ruled in 1935 that it could not properly act on the petition unless the request came from the Australian people as a whole, given the Statute of Westminster 1931. The petition went no further. (Musgrave, "The Western Australian Secessionist Movement", Macquarie Law Journal, 2003)
• Later in 1933, the Commonwealth set up the Commonwealth Grants Commission to advise on special grants to states, the same body that advises on GST shares today. (Commonwealth Grants Commission, Our history)

4. The hurdles: Constitution, trade and currency

• The Constitution makes it very hard. The preamble to the Commonwealth of Australia Constitution Act records that the colonies agreed to unite in "one indissoluble Federal Commonwealth". (Australian Constitution)
• Section 128 sets the only path to change the Constitution: a law passed by federal Parliament, then a national referendum approved by a majority of voters nationally and a majority of voters in a majority of states (at least four of six). WA voting yes on its own would not be enough. (Constitution, s128)
• London is no longer an option. The Australia Acts 1986 ended any power of the UK Parliament to legislate for Australia or its states. (Australia Act 1986)
• Trade. Today goods move freely between states (s92), and only the Commonwealth may impose customs duties (s90). An independent WA would need new trade deals with Australia and with every partner, and to replace Australia's existing agreements.
• Currency. Currency is a Commonwealth power (s51(xii)). WA would have to keep using the Australian dollar without a say in setting interest rates, or build its own currency and central bank, each with real costs and risks.

5. What could be: a small-government WA

Whatever you think of secession, the thought experiment points somewhere useful. A WA that kept more of what it earns, inside or outside the federation, could choose to:

• Tax less and tax simpler. WA's payroll tax applies at 5.5% once an employer's annual wages pass $1 million, with the tax-free threshold phasing out up to $7.5 million. In 2026-27 that $1 million threshold is the equal-lowest of any state or territory, shared with Victoria. (Revenue WA; state and territory revenue offices, rates and thresholds) That is a tax on hiring that could be lifted.
• Drop the worst taxes first. Federal Treasury modelling estimates stamp duty on property costs about 72 cents in lost living standards for every extra dollar it raises, one of the least efficient taxes in the country. (Treasury Working Paper 2015-01)
• Cut red tape. Fewer layers of government means fewer overlapping approvals for businesses, farmers and builders.
• Keep decisions close to home. People who earn the money are best placed to decide how it is spent.

None of this needs a new country. Much of it is within reach of the WA Parliament today, and a fairer deal within the federation would help pay for it. And with more people moving to WA from other states than leaving (a net gain of 10,314 people in the year to March 2026), WA starts from a position of strength. (ABS National, state and territory population, March 2026)

Reminder: this is a thought experiment, not currently official Libertarian Party WA policy. We publish it to get West Australians thinking about where their money goes and who decides. Tell us what you think, and see what we are actually campaigning for on our policies page.