Labor has slammed Treasurer Joe Hockey for trying to pressure it to support a GST increase, but says a proposed new property levy from the Grattan Institute may be a good way for state governments to increase their revenues.

Opposition finance spokesman Tony Burke said Labor still opposed "increasing the rate and base" of the GST, after Mr Hockey said it would be "ridiculous" if Labor did not agree to do so if that was what the states wanted.

"There is no other way of dealing with the GST than acknowledging it's a regressive tax," Mr Burke said on Wednesday.

"There's no way of increasing the revenue for it without hurting people who can least afford it."

Prime Minister Tony Abbott will hold a leaders' summit in Sydney next week with state premiers and chief ministers and plans to raise there the question of Commonwealth/state funding arrangements, including the GST.

He will tell premiers they need to eventually take control of public hospitals and schools and they will need a state revenue base to match that.

Mr Hockey has put fresh pressure on the states ahead of the summit, saying some of them ought to rethink their opposition to increasing the GST because they need to start taking responsibility for their budgets, and need to find a way to afford their "ever increasing expenditure" on public hospitals and schools.

The Grattan Institute think tank warned this week that state budgets face an annual $16 billion revenue shortfall by 2024-25 as a consequence of the Abbott government's decision to substantially reduce promised transfers to the states for hospitals and schools.

But Grattan chief executive John Daley has also proposed a new property tax for state governments, saying it would raise $7 billion in extra revenue a year and make them less reliant on Commonwealth government funding.

Mr Daley said the annual levy would be $772 on the median-priced Sydney home, and $560 on the median-priced Melbourne home, with lower average rates in other cities and the regions.

He said people with low incomes and no wealth would pay nothing, while low-income retirees with high-value houses could defer paying the levy until their house was sold.

Mr Burke said Mr Daley's proposal could be an efficient way for state governments to raise more revenue.

"That's the sort of reform that can involve, if it's done the right way, an improvement in efficiency," he said.

"[But] those are issues for state governments."

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