CA ANZ welcomed the opportunity to provide a submission to the International Ethics Board for Accountants (IESBA) on its proposal to revise the international Code of Ethics (IESBA Code) to address tax planning and related services. 

The proposed changes to the IESBA Code are intended to respond to public interest concerns identified by IESBA about tax avoidance and the alleged role played by professional accountants (PAs) in those activities. 

IESBA proposes that two new sections be added to the IESBA Code (section 280, for PAs in business, and section 380, for PAs in public practice) to strengthen the ethical expectations for PAs when performing tax planning and related services.   

For more information on the proposals, please see the IESBA website. 

If adopted by IESBA, the finalised proposals would be incorporated into the IESBA Code which will then apply to members of CA ANZ. 

In our submission we asked IESBA to reconsider whether introducing two new sections to the IESBA Code is the best approach to addressing stakeholder concerns regarding tax planning.  The reasons for this request included: 

• Tax (including terminology) remains very jurisdiction specific (unlike accounting and audit), and stakeholder concerns regarding tax planning would be better addressed in each jurisdiction by anti-avoidance legislation, backed up by local application of the current provisions of the IESBA Code – including but not limited to the fundamental principles – by IFAC member bodies.
• IESBA has as a result of these jurisdictional differences made generalisations/compromises in drafting and chosen terminology for the proposed sections that may not be readily understood or easily complied with by PAs in individual jurisdictions.  The resulting confusion may impose significant and unnecessary additional compliance costs on PAs, professional bodies and regulators. 

Our submission also included comments on the proposed sections themselves, should IESBA proceed with its proposed approach.  These comments included disagreement with the broad definitions of “tax planning” and “related services” and with the subjective nature of the “stand-back text”.