The details of the exemption granted to the Transport Asset Holding Entity (TAHE) are detailed in an Audit Office report released on Friday into the state’s transport agencies,which included a raft of recommendations.
The controversial for-profit corporation controls billions of dollars of state rail assets including trains and stations.Brook Mitchell
While TAHE was initially given a 12-month tax break,the auditor-general’s report reveals that in July last year the government approved extending it for another two years.
The corporation,which controls billions of dollars’ worth of the state’s rail assets including trains,stations and rail track,has been the subject of intense scrutiny over the past year.
The government has been forced to write down the value of TAHE by $20 billion and inject billions of dollars into the rail corporation to make it stack up commercially.
Auditor-General Margaret Crawford delayed signing off on the state government’s financial accounts by months late last year due to major concerns about TAHE and,in February,the watchdog accused Treasury of into the rail corporation.
NSW shadow treasurer Daniel Mookhey.Michael Quelch
Shadow treasurer Daniel Mookhey said the exemption from state taxes was “more proof that the TAHE is a sham”.
“The Premier has given TAHE a long holiday from state taxes because otherwise it would sink the very corporation he set up,” he said.
“If TAHE is capable of earning a profit,it should pay every cent of every tax it owes. TAHE deserves no special privileges. It’s time for them to pay up.”
A spokesman for Premier Dominic Perrottet directed questions to Treasurer Matt Kean. A spokeswoman for Kean said the tax exemption was required to enable the valuer-general to undertake the “extensive work” required to value TAHE’s landholdings. “This is common sense and it is unclear why Labor is continuing to politicise a state-owned corporation,” she said.
The auditor-general has also put TAHE on notice by undertaking a performance audit of the corporation,which will be released later this year.
Last month a final report from a NSW parliamentary inquiry into the rail corporation recommended that TAHE be dismantled due to the risks it poses to the state budget and the safety of the railways.
The inquiry was sparked by aHerald investigation that revealed the government set up the rail corporation in 2015 to by billions of dollars by shifting rail expenses into the state-owned entity.
An agreement between TAHE and the state’s passenger rail operators in December set out plans to raise the fees charged to Sydney Trains and NSW Trains by $5.2 billion over the next decade to a total of $17 billion.
While the government was forced to inject an extra $1.1 billion over the next three years into the rail operators,the auditor-general warned that “the revised access fees will significantly increase” costs to the budget beyond 2025.
The auditor-general has recommended that TAHE finalise the commercial agreements with the rail operators to reflect fees detailed in the December deal,and “prepare robust projections and business plans” to support returns beyond 2031.
In the latest report,the auditor-general also reprimanded Transport for NSW for limiting access to documents about TAHE over the past five years. “Transport for NSW needs to significantly improve its processes,” her report said.
The reprimand came three months after the auditor-general for presenting “late,unsophisticated,and inaccurate forecasts”,all of which sought to support its desire for higher projected returns from the controversial rail corporation.
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