A coalition of professional associations claims Assistant Treasurer Stephen Jones has misrepresented the extent of consultation on additions to a code of professional conduct that embeds further ethical obligations on financial and tax advisers.
The 10 bodies intensifying a campaign to get new regulations disallowed by the Senate are Australian Bookkeepers Association, Chartered Accountants Australia and New Zealand, CPA Australia, Financial Advice Association of Australia, Institute of Certified Bookkeepers, Institute of Financial Professionals Australia, Institute of Public Accountants, NTAA, SMSF Association and The Tax Institute.
A joint statement released yesterday by the bodies says that the final determination issued by Jones contained material that was not subject to consultation during a formal exposure process during December and January.
It says a new obligation to “dob in” clients to tax authorities if the client fails to change information on their tax return was not in the original drafted exposed for public comment.
The bodies’ statement says that this obligation was first seen by them when the instrument was issued by the minister, and that it would be the first time in tax law that advisers would be required to ‘dob in’ clients to authorities.
The statement is a response to comments from a spokesperson for Jones’ reported by Professional Planner earlier this week in which it was said that the bodies were consulted through the development of the determination.
“A draft of the Determination was released on 10 December 2023 with a consultation period running through to 21 January 2024. The Joint bodies provided a submission on the draft Determination,” the bodies’ statement says.
“However, it is incorrect for the Assistant Treasurer and Minister for Financial Services, the Hon Stephen Jones MP, to say ‘Tax Practitioners and their professional associations were consulted throughout the development of the Code as it was proposed, including in the weeks before the Government’s announcement to introduce the new obligations’.
“No further consultation or engagement after January was undertaken on the Determination before it was registered on 2 July 2024 (six months later).”
The ‘dob-in-a-client’ provision of the determination is one of two provisions that are of concern to the professional bodies representing individuals and entities registered with the Tax Practitioners’ Board.
Notifying clients of any matter that might impact their decision to engage or continue to engage a tax agent that include the need to advise clients of any disciplinary before guilt is proven is the other issue that is also of concern.
The 10 bodies have also expressed concerns about the transitional period and that all practitioners have an effective date of August 1 – the initial effective date for the new rules before staggered implementation was announced by Jones -without further clarity on how this might operate.
This statement from the bodies comes two days after the Federal Coalition announced plans to move a disallowance motion to kill off the determination.
That motion will be debated on September 10 by the Senate, and independent Senator David Pocock has indicated he would consider lending his support if the government fails to address concerns highlighted by the professional bodies.
