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Archived - Draft legislation on new legislative framework for tax practitioners
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8 April 2008  
 
Following the meeting of the Institute's Tax Counsel with the Queensland Tax Agent Board (the "Qld Board") on 18 February 2008 (reported in Edition 5/2008 of the Tax Bulletin), the Qld Board has provided us with some guidelines in relation to outsourcing of tax agent services which is available here. These guidelines have emerged from discussions, which took place at the conference of the Chairs of the State Tax Agents Boards on 6 March 2008. 
 
 
February 2008 
 
Meaning of “supervision and control” 
The Institute lodged a submission on 8 February 2008 with the Queensland Tax Agents' Board (the Board) on the meaning of “supervision and control”. The Board had obtained a Memorandum of advice on the interpretation of "supervision and control" contained in Part VIIA of the ITAA 1936 and Subdivision 604-A of the Tax Agents' Services Bill 2007..  
 
The Institute has disagreed with a number of positions taken in the Memorandum, expressing the view that the meaning of "supervision and control" is ambulatory in nature and thus should be given a contemporary meaning and not one that remains 'locked in time', provided that such meaning advances the legislative purpose of the enactment.  
 
9 August 2007 
 
Today the Institute, in conjunction with CPA Australia and NIA, has lodged a detailed joint submission on the draft legislation on the new legislative framework for tax practitioners. 
 
Some of our key concerns and recommendations include:

  • lack of detail in the legislation and over reliance on the explanatory memorandum which itself requires improvement
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  • significant modification and clarification required with respect to the code of professional conduct in particular clarification is sought to ensure that tax practitioners are not obliged to audit all information provided to them by their clients
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  • ensure that the new National Tax Practitioners Board is sufficiently independent from the ATO and is seen to be so.
We wish to thank all members, particularly members of our various committees, who have provided significant input into the preparation of this submission. 
 
6 August 2007 
 
The Institute, in conjunction with CPA Australia and NIA, has prepared a draft joint submission on the draft legislation on the new legislative framework for tax practitioners. The submission includes comments received from members since the public release of the draft legislation in May. A copy of the draft submission can be found here. If members have any further comments on the draft legislation or the draft submission, please send them to taxgroup@charteredaccountants.com.au by COB 7 August 2007.  
 
23 July 2007 
Treasury response to certain issues 
 
On 23 July 2007, Treasury provided responses outlining its position on five main issues relating to the new legislative framework for tax practitioners. The responses relate to the following issues:
  • What is expected of tax practitioners by the requirement in subsection 604-10(10) that a tax practitioner must take reasonable care to ascertain the true state of the affairs of clients that are relevant to the taxation law?
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  • Who may provide continuing professional education courses under the draft legislation?
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  • Why is the Code of Professional Conduct legislated, rather than promulgated by the new National Tax Practitioners Board (the Board)?
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  • What steps will be taken to ensure sufficient independence of the Board from the ATO?
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  • Are all bookkeepers required to register as BAS service providers?
The responses can be accessed here. 
 
The clarification provided by Treasury on these issues is welcome. Nevertheless, we will continue to include these issues as well as others in our joint submission with other professional bodies on this draft legislation.  
 
July 2007 update 
 
The Minister for Revenue and Assistant Treasurer has recently announced an extension for the due date for lodging submissions on the draft legislation on new legislative framework for tax practitioners. Since the open forum sessions in June, we have received further comments from members. These comments have been incorporated into a revised Issues Table.  
 
The due date for submissions is now 10 August 2007. Members who wish to provide further commments on the draft legislation and related materials, please send them to Tax Group no later than 1 August 2007 to allow sufficient time to incorporate them into the final submission. 
 
June 2007 
 
Following feedback received from the Open Forum Sessions conducted over the last few weeks, members of the Institute's committees and others, we have consolidated comments received to date as well as the Institute's comments into an Issues Table. This is a draft document and will be used in formulating a submission to Treasury. Members who wish to provide further feedback on the draft legislation, please send them to Tax Group as soon as possible. 
 
7 May 2007 
 
The long awaited exposure draft legislation on the new legislative framework for tax practitioners was released for public consultation on 7 May 2007.  
 
The new legislative regime was announced by the government in April 1998, following the Report of the National Review of Standards for the Tax Profession (the Review) released in November 1994. The Review was undertaken jointly by various professional bodies, including the Institute, and the ATO. Since then, the proposal to review the regulatory regime for the tax profession was referred to Treasury and the scope of the proposal has changed to some degree. Over the past couple of years, the Institute has been participating in confidential consultation with Treasury on this new regime. A number of our key concerns have been addressed in this draft whilst other concerns remain which we now need to work on with Treasury to resolve before it becomes law.  
 
As announced by the government, key features of the new regime include:
  • A national Tax Practitioners Board to replace the existing state Tax Agents Boards
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  • A new Code of Professional Conduct for tax practitioners
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  • A wider range of disciplinary sanctions
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  • Registration and regulation of Business Activity Statement (BAS) service providers
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  • A safe harbour from penalties for taxpayers
For further details on the new regime, refer to the draft legislation and related materials, which are available on the Treasury website.  
 
For a copy of the Minister for Revenue and Assistant Treasurer's press release introducing the draft legislation, go here.  
 
As the new legislative framework has major ramifications for the tax profession, it is imperative that members are aware of the proposed changes and provide any feedback to the Institute so that any concerns can be included in the submission to Treasury.  
 
The Institute will be holding Open Forum Sessions to seek members’ feedback on the new legislative framework in early June. These sessions will be held at the Institute’s offices in Brisbane (1 June), Melbourne (8 June), and Sydney (12 June). Members who wish to attend these sessions, should contact the Tax Group as soon as possible. 
 
Alternatively or in addition to attending the above, members may wish to send their comments on the draft legislation to Tax Group by COB 13 June 2007.