Date posted: 15/07/2019 5 min read

Review of the Tax Practitioners Board

CA ANZ’s submission to the Treasury on the independent review of the effectiveness of the Tax Practitioners Board (TPB), including the Tax Agent Services Act 2009 (TASA) and the Tax Agent Services Regulations 2009 (TASR).

In brief

  • CA ANZ has been asked by Treasury to the participate in the review
  • Advocacy & Professional Standing team has made submissions and attended roundtable and consultation forum
  • A discussion paper will be released shortly

Tax Practitioners Board Consultative Forum

On Wednesday 3 July, Donna Bagnall (Senior Tax Advocate) and Bronny Speed (Financial Advice Leader) attended the Tax Practitioners Board (TPB) Consultative Forum meeting in Sydney on behalf of Chartered Accountants ANZ, with other peak professional bodies in taxation and financial advice services. This meeting was a consolidated group session convened primarily for the TPB and Treasury to provide and receive further feedback on the Review of the TPB. The meeting was chaired by Ian Klug, Chair of the TPB, and was attended by Nick Westerink from Treasury, together with other TPB Board members and staff.

Key issues discussed included the importance of the TPB having structural and operational independence from the ATO, both actual and perceived independence. Various practical examples were discussed to highlight issues and concerns should this TPB independence not exist, such as the need for natural justice by ensuring impartial minds in fact-gathering and decision-making processes regarding conduct, and an open and frank educational, support, and regulatory relationship between the TPB and registered agents. The TPB must be independent of any tax technical disputes, systems challenges, risk rating processes, or other perspectives of the ATO. Also, independent of the ATO’s revenue collection obligations and objectives. This independence is particularly important if the TPB intends to work even more closely with the ATO in the future, including increasing the formal exchange of information, etc. We also briefly discussed the different roles, functions and objects of the TPB and the ATO as part of the tax system, and the distinction between the TPB regulating the integrity of tax agents, and the ATO administering the tax laws and systems in a way that maintains the integrity of the tax system. They are distinct roles, functions and objects.

The benefits of the existing structure of the TPB (funded and staffed by the ATO) were discussed, being the large cost savings achieved from shared services and co-locating. Discussions were also had around whether the shift in the role of the TPB Board to a more traditional governance model of non-executive directors where the staff execute the role as regulator (compared with the executive role of the former Chair) is changing the role of the TPB to one that is more about being a regulator than an educator and supporter, and whether this reflects a change in TPB Board strategy. The TPB indicated that we have moved into less of an educational period, and more of a regulatory period, being 10 years into the regime. However, the TPB still intends to maintain an educational, support and regulatory mix of activities. There were also some discussions about how the TPB regulatory regime should dove-tail with the financial advice sector, post-Hayne Royal Commission report, about the Code of Conduct, about making “relevant experience” more flexible, and about the TPB’s sanction powers.

The final report on the Review of the TPB is still due to government on 31 October 2019. A Discussion Paper will be released shortly for a further round of consultation on more specific questions and options/proposals.

We will report the communique from the meeting when it becomes available in the coming weeks.

Review of the Tax Practitioners Board

In May, Chartered Accountants Australia and New Zealand (CA ANZ) lodged a submission for the review of the effectiveness of the Tax Practitioners Board (TPB), including the Tax Agent Services Act 2009 (TASA) and the Tax Agent Services Regulations 2009 (TASR) to ensure that tax agent services are provided to the public in accordance with appropriate professional and ethical standards.  

Overall, we believe that the TPB’s regulation of tax practitioners is working effectively in that there is little evidence of regulatory failure in terms of the legislative objective of consumer protection. The TPB has been active and performing its enforcement function effectively and successfully, although we feel more strategic interactions with the tax profession and relevant professional associations could improve its efficiencies. There is room for improvement around the academic prerequisites and the TPB’s compliance, investigation powers and functions.  

The submission also provides a log of specific issues that we have collated from CA ANZ’s experience with the TASA over the past decade.