Treasury has released a consultation paper seeking input on proposed reforms to education, qualification and experience requirements for tax practitioners.
The consultation paper, announced by Assistant Treasurer and Financial Services Minister Stephen Jones on 17 July, outlines three reforms for tax agents registering with the Tax Practitioners Board (TPB).
The first proposal introduces an additional registration requirement for companies and partnerships employing tax practitioners. These entities must demonstrate sufficient governance arrangements to ensure tax agents comply with their obligations.
The second proposal broadens the types of relevant experience accepted by the TPB for registration. This includes international and non-traditional experience and makes accommodations for career breaks or parental leave. Under the change, the TPB will consider practitioners’ relevant experience on a case-by-case basis or extend the period within which this experience can be gained.
Additionally, the consultation paper suggests eliminating the professional association accreditation pathway for tax practitioners. Treasury believes this reform will address independence concerns and strengthen the registration regime by increasing the minimum education requirements for becoming a tax agent.
“The proposals reflect the government’s commitment to strengthen our regulatory arrangements in response to the PricewaterhouseCoopers (PwC) matter,” Financial Services Minister Stephen Jones said.
“This is the fourth of eight Treasury‑led reviews announced by the government in its PwC response. It follows the government’s latest reforms passed by parliament in the Treasury Laws Amendment (Fairness and Accountability) Bill 2023 and $30 million in the October 2022/23 budget for the TPB to step up compliance activities in relation to high-risk practitioners.”
Consultation for the proposed reforms will close on 7 August.
In a related matter, 10 professional bodies met with Treasury yesterday to express their concerns regarding changes to the professional code of conduct for registered tax agents.
Commenting on the meeting, the Institute of Financial Professionals Australia (IFPA) said the 1 August timeline for implementing the changes was unworkable for many in the industry, particularly smaller operators.
“While the professional bodies all broadly support the notion of tax practitioners conducting themselves in a way that promotes community confidence in the tax system, we strongly argued the highly prescriptive way of imposing several new obligations under the code of professional conduct is not the way to achieve that,” IFPA stated.
“As well as arguing that the existing principle-based code in the Tax Agent Services Act already provides for sanctions where there has been inappropriate behaviour, the professional bodies are highly concerned about the lack of consultation and the apparent need for the TPB to soften the hard edges of the new law by issuing (non-binding) practical guidelines. It’s more important for the law to reflect the policy.
“We call on the Assistant Treasurer to withdraw the legislative instrument. There should be a proper consultation process aimed at developing a more workable set of rules. The professional bodies stand ready to participate constructively in such a process.”
