The Federal Government has released a draft guidance note for the implementation of tax incentives for projects worth more than $500 million with the aim of unlocking billions of dollars in capital for infrastructure.
The new economic infrastructure staples tax concession (the concession) has been released for consultation.
The concession allows the Treasurer to approve applications for a 15 per cent concessional withholding tax rate for economic infrastructure projects, instead of the 30 per cent that would otherwise apply.
To qualify, these major projects must have an estimated capital expenditure of $500 million or more and cover a diverse range of economic infrastructure projects in the areas of transport, energy, communications and water.
The application of this tax rate will apply to projects that are in the national interest and significantly enhance the long-term productive capacity of the economy.
This tax incentive will support the development of nationally significant infrastructure, whilst protecting the integrity of Australia’s corporate tax system as well as help to maintain Australia’s international competitiveness.
The concession builds on the Federal Government’s record $100 billion infrastructure investment outlined in the 2019-20 Budget.