Australia is hoping a possible adjustment in tax law can help invigorate investment in its national infrastructure.
The Department of Treasury, charged with developing economic policy in Australia, in May put forth a 12-point plan that included a measure aimed at “improving certainty” by allowing infrastructure work to carry forward tax loss with an “uplift factor” to maintain value.
The envisioned tax change is intended to incentivize private investment infrastructure—with a particular goal of increasing superannuation fund investment in the asset class.
Yesterday, the department opened a six-week “consultation period” on the measure, inviting public comment. The consultation period is due to end on December 9, according to a statement from the Department of Treasury.
A change would allow an investor to “more easily and with greater flexibility” claim a tax loss, making investing in infrastructure “more attractive to the private sector,” said Bill Shorten, assistant treasurer.
Meanwhile, minister of infrastructure Anthony Albanese said Australia must increase capital inflow into infrastructure in order to “compete in the 21st century”. Shorten and Albanese co-authored a media release, “Encouraging More Investment in Infrastructure,” published yesterday.
Infrastructure Australia, a government agency founded to coordinate infrastructure activity across Australia, has estimated the continent will require A$700 billion (€529 billion; $725 billion) of new infrastructure in the next decade.
Australia has A$1.3 trillion in total superannuation fund, or retirement fund capital, making the continent the fourth-largest retirement market worldwide.