Infrastructure investments and stapled structures | KPMG | AU
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Infrastructure investments and stapled structures: insight in uncertain times

Infrastructure investments and stapled structures

Scott Farrell, Ed Tong, and Harsh Sinha, Corporate Tax Specialists, discusses current developments in infrastructure investments and stapled structures.


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Aerial view of modern infrastructure

There has been considerable discussion within the infrastructure sector following the ATO’s release of the Taxpayer Alert 2017/1 and the Privatisation and Infrastructure – Australian Federal Tax Framework (January 2017 Draft).

KPMG hosted a number of forums with representatives from the ATO, Treasury and industry to facilitate the sharing of perspectives regarding infrastructure investments, with the key themes emerging:

  • Use of stapled structures including the lack of clarity regarding the expected tax outcomes for infrastructure investments.
  • Need for government to confirm its tax policy settings.
  • Impact on future infrastructure investment decisions in Australia.
  • Treatment of existing stapled structures, and impact on transactions in other sectors such as finance and real estate.

It is clear that the ATO needs to further articulate its views on the use of stapled structures.

One could argue that this will result in the death of stapled structures in the infrastructure and renewable energy industry, irrespective of whether such structures are owned by Australian or non-Australian investors. This, however, would be an overreaction based on the limited guidance. In our view, the continued use of stapled structures in the infrastructure sector will be heavily dependent on the facts and circumstances of the specific investment.

Where to from here?

It is critical to review existing positions adopted in current investments, including:

  • what this means for current investments using stapled structures
  • the impact on consortium partners and the structure of prospective investments, in light of the ATO’s input into the FIRB approval process
  • issues of concern that you wish to raise in submission to both the ATO and Treasury (in respect of appropriate future tax policy settings).

The Taxpayer Alert and Framework are currently subject to a consultation period with the ATO which concludes on 28 April 2017, for which KPMG is preparing a submission.


Read more for a summary of the key messages arising from these forums.

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