The Government on Thur 18.4.2013, released draft legislation for a new tax loss incentive for major infrastructure projects [this was announced in the 2011-12 Federal Budget on 10 May 2011]. The draft legislation is on the Treasury website.
Under the new regime, the Infrastructure Coordinator, a statutory officeholder under the Infrastructure Australia Act, will designate projects as eligible for the tax concession if they meet the relevant criteria.
- Projects will need to be included on Infrastructure Australia’s Infrastructure Priority List and
- assessed as “Ready to Proceed”,
- at least some part of the project must be privately owned or financed, and
- construction of the project must not have commenced.
The new rules are designed to ensure that entities carrying on these projects will have the value of their up-front losses indexed to preserve their value over time, and the losses will continue to be available even if the ownership of the company changes.
In foreshadowing the draft legislation in a recent speech, the Assistant Treasurer said the new tax incentive will mean the value of carry-forward losses attributable to designated infrastructure projects will be uplifted by the 10-year Government bond rate. In addition, those tax losses will also be exempt from the continuity of ownership test and the same business test, he said.
COMMENTS are due by 30 April 2013.
Source: Assistant Treasurer’s media release No 050, 18 April 2013
[LTN 74, 18/4/13]