On 10 May 2011, the Treasurer announced a reform designed to encourage private investment in infrastructure, as part of a suite of reforms targeted at strengthening Australia’s infrastructure framework. Under this proposal, losses generated by certain infrastructure projects will be exempt from the Continuity of Ownership Test and the Same Business Test. Any prior year losses can also be adjusted in line with the government bond rate. These tax incentive measures for investment will be supported up to a cap of $25 billion worth of value in projects, and only in relation to projects that are designated on Infrastructure Australia’s National Priority List as ‘ready to proceed’ or ‘threshold’. Further consultation will be undertaken in implementing the reform. The Regulation Impact Statement was prepared by the Treasury and assessed as adequate by the Office of Best Practice Regulation.
