From the AFR:
The federal government has come to an agreement with the states and territories to provide incentive payments in turn for capital spending on infrastructure, after a Treasurer’s meeting in Canberra on Wednesday.
Under the in-principle deal, the states would have to agree to privatise assets. The corporate tax the private owner would then pay to the federal government would instead be returned to the respective state government as a tax equivalent incentive payment.
The idea is to fast-track the building of infrastructure to stimulate the economy as the mining boom ends.
NSW Treasurer Mike Baird described the move as an “incredibly positive step”.
Sensible enough. But it needs to be in the context of a larger discussion about competitiveness or it is just kicking the can.
