Tax & Super Australia is gravely concerned about the mounting negative effects of the Australian financial services licensing regime on accountants and wants the accountants’ exemption that previously existed under Regulation 7.1.29A of the Corporations Regulations 2001 to be reinstated.
According to Tax & Super Australia chief executive Moti Kshirsagar, empirical evidence suggests that two years since the licensing regime began accountants are dealing with increased costs and an onerous compliance regime where these cost hikes have been passed onto clients.
Tax & Super Australia estimates accountants’ average cost of providing advice to their clients is currently around $2000.
In addition, accountants who are qualified to provide advice are withdrawing their services due to excessive compliance costs and highly cumbersome regulatory processes.
The accounting body is “gravely concerned” this phenomenon could result in substantially reduced competition, exacerbated by increased costs and fewer services.
“Left unchecked, this will only lead to further increases in costs to the ever-growing 600,000 SMSFs in Australia, currently costing SMSF trustees, self-funded retirees and many small business operators over $1.2 billion in additional fees that are unjustified and unsustainable,” Kshirsagar warned.
In its submission to the banking royal commission, the body called for the reinstatement of the accountants’ exemption to “right the wrong” that has been caused by government changes that came into effect from 1 July 2016 as they apply to accountants.
“We’ve reached the point where regulation is hurting the people it aims to protect,” Kshirsagar said.
“In an attempt to target a minority of wrongdoers, the government has got it wrong by imposing significantly higher cost burdens on SMSFs and self-funded retirees by overlooking the financial goals, retirement savings and financial well-being of ordinary Australians.”
He has also called upon other accounting bodies to stand up for their members and support Tax & Super Australia on this critical issue affecting the accounting fraternity.
“Tax & Super Australia’s vision is for a fair, efficient and cost-effective compliance system for all Australians,” he said.
The licensing regime commenced on 1 July 2016.
Tax & Super Australia was formerly known as Taxpayers Australia.
