Please attribute to Ainslie van Onselen, CA ANZ Chief Executive Officer:
“CA ANZ maintains our concern about new obligations on tax practitioners under the Tax Agent Services (Code of Professional Conduct) Determination 2024, introduced by the Assistant Treasurer on 2 July.
As part of an alliance of professional bodies advocating on this issue, CA ANZ has received confirmation that there will be movement on the implementation timelines, with a transitional rule to be introduced into the Determination that will:
“Provide firms with 100 employees or less until 1 July 2025 and larger firms with 101 employees or more until 1 January 2025 to bring themselves into compliance with the new regulations, as long as they continue to take genuine steps towards compliance.”
While some may welcome this additional time, CA ANZ’s view is that moving timelines does not change the rules themselves. Instead, we call for the current legislative determination to be withdrawn and rewritten. This would allow major areas of concern for our members to be addressed – in particular Sections 45 and 15.
Section 45 requires tax professionals to advise all current and prospective clients of ‘any matter’ dating back to 1 July 2022, that could ‘significantly influence’ a decision of a client to engage with them, but there is no clarity regarding what ‘any matter’ must cover.
While the Chair of the Tax Practitioners Board (TPB) has recently suggested in a media article that the requirement to disclose mental health matters is something that would be clarified via TPB guidance, it is important to remember that guidance does not overrule law, and the TPB cannot amend the law through its guidance.
Any law that is open to being interpreted as requiring individuals to disclose their private health information has serious human rights implications and amounts to a significant breach of privacy.
Personal health is a deeply private matter, which is why Australia already has laws in place regarding the collection and disclosure of information concerning a person’s health.
Our second concern is the requirement to disclose to clients and prospective clients if they are subject to an investigation by the TPB or another relevant body.
It is important to remember that an investigation by the TPB, or any body for that matter, does not always find that inappropriate or unlawful behaviour has actually occurred. Indeed, vexatious or spurious complaints against tax practitioners are not uncommon with only seven per cent of TPB investigations last year leading to sanctions.
The very real risk of this requirement is that clients would act on a presumption that their tax agent is guilty until they are proven innocent, causing great reputational and commercial damage to tax practitioners, without increasing consumer protection at all.
None of these matters appear to have been considered in the context of the Statement of Human Rights accompanying the Explanatory Statement on the Determination, which suggests these important new requirements have not been properly thought through or legislated.
Finally, Section 15 of the Determination requires tax practitioners to ‘dob in’ clients where there is a refusal to correct a material false, misleading or incorrect statement (Section 15(2)(c)). This provision discourages clients from having frank and open discussions with tax practitioners and could worsen tax compliance. This section has not been subject to consultation, having been added post the consultation round in December-January.
We will continue to work with the Government and Parliament to make these concerns clear.
To be clear, CA ANZ supports the Government’s intention to close regulatory gaps, drive cultural change, and to play its part in decreasing the chance of a repeat of misconduct which has been the subject of wide scrutiny in recent times.
But we have to get the changes right.”
ENDS
Media Contact
Gillian Bowen
M +61 (0)411 485 421
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