Poles and wires tax deal puts the heat on Premier Barry O'Farrell Premier Barry O'Farrell with NSW Governor Marie Bashir. TREASURY tsars are trying to snooker Premier Barry O'Farrell into a $30 billion electricity poles and wires sale, through a deal to change tax arrangements that would benefit the state by a neat $5 billion. Under competition policy, state-owned corporations such as the electricity companies currently pay a "tax equivalent" to the state government - the same amount they would pay in company tax if they were privatised. But if there was a sell-off, all that money would be paid by the owning private firm to the commonwealth in the form of company tax. As a result, although the state government could reap $30 billion from the sale, it would lose revenue worth $5 billion over 10 years. This, in turn, could be used as an argument in state cabinet not to press ahead with a sale. But under an in-principle agreement nutted out with state treasurers on Wednesday, federal Treasurer Joe Hockey has promised to give upfront payments from the company tax proceeds for 10 years after the sale to state governments to encourage them to build infrastructure. The finer detail of the plan will be worked out in time for the federal budget next May, NSW Treasurer Mike Baird said yesterday. "Obviously we have a range of assets we have already (sold), they want that across the other states," Mr Baird said. There's significant capital sitting on every state government balance sheet if you leverage that ... link in with private sector, we have got (the funds for)... tens of billions of dollars of infrastructure. Every state government would be discussing with cabinet and parties the ... transactions they want to undertake and what's got financial benefit ... and what could you do with it. Mr Baird is hoping to reap the benefit through sales that are going through - including the sale of the state's ports and electricity generators. But it is understood the real enthusiasm of the Treasurer is for a sale of the electricity networks - or "poles and wires" - to help fund the WestConnex, North West Rail and a second rail Harbour crossing. The Premier has said he would not consider a sale unless he won a mandate, suggesting he would consider taking the policy to the 2015 election. Mr Baird and others in government are understood to be concerned Mr O'Farrell might not go ahead with the sale. The Treasurer yesterday said he had no indication from the Premier on the matter, saying: "That's obviously a matter for next year." Mr O'Farrell caused murmurs among his MPs in parliament last month when, asked by Opposition Leader John Robertson if he would rule out the sale of the electricity distribution networks, he said "yes" and sat down. The only way out of misleading parliament on that question would be if the government were to enter into a long-term lease - which would have the same effect as a sale. A spokeswoman for Mr Hockey said: "We don't have a position on NSW electricity poles and wires."