Commonwealth Grants Commission

The Commonwealth Grants Commission is an Australian independent statutory body that advises the Australian Government on financial assistance to the states and territories of Australia under section 96 of the Australian Constitution. The commission was established in July 1933 by the Lyons government during the Great Depression to provide impartial advice on the distribution of federal government grants to the states.^[2] The commission operates under the Commonwealth Grants Commission Act 1973, and is responsible for measuring the relative fiscal capacity of each state and territory.

The Commission recommends how the revenues raised from the goods and services tax (GST) should be distributed to each state and territory to achieve horizontal fiscal equalisation, a central feature of the Australian federation.