The Northern Territory Treasurer Nicole Manison says she only found out she had been hit with a $75 million funding black hole when Tuesday's federal budget was released.
The cash-strapped NT Labor Government complained that the latest fall in its GST allocation came on top of a $500 million cut for the next fiscal year.
However the NT's GST will actually increase from $2.74 billion to $2.78 billion in 2019-20, the federal budget papers show, and the gripe relates to what NT Treasury staff forecasted in a mid-year update last year.
The cut was described as a devastating blow by Ms Manison, who is preparing the NT's budget, is tackling a weak local economy, record debt, a structural deficit, and is due to receive John Langoulant's independent report into government spending in days.
"It is where we expected money to be going and we have to deal with the fact we have less GST coming in," Ms Manison told reporters on Wednesday.
People in Canberra did not seem to understand how important the GST was to to delivering frontline services and tackling the Territory's large amounts of disadvantage, she said.
"We have people in very remote localities and huge infrastructure deficits ... every time we lose GST money that puts more pressure on the work we're trying to do to help people have better lives and overcome disadvantage."
NT Senator and Indigenous Affairs Minister Nigel Scullion dismissed complaints about the GST as a "massive piece of propaganda" by fools.
The complex grants system in which Commonwealth GST is divvied up to the states has been reformed in the last year to make it fairer.
The NT's share is at risk of falling but Senator Scullion pointed out it would not fall below a floor level and the Territory had received top-ups of $259 million this year and $252 million next year.
"They come down to Canberra and say "we are right out of money, we're broke, we've spent $4 million more a day than we've actually got but we are not cutting a single thing, not cutting a single public servant or increasing any of our invoices'," he said.
He also rejected Ms Manison's key complaint after the budget that no start date for $216 million in funding to revitalise Kakadu National Park to boost tourism and the economy had been given.
He said up to $150 million of the money would be delivered over the next four years, for road and infrastructure upgrades, a new visitor centre in Jabiru and other work.
