The Assistant Treasurer and Minister for Competition Policy and Consumer Affairs, Chris Bowen MP, today released for public comment an exposure draft package that will reform the registration and regulation of entities providing tax agent services for a fee.
The package consists of a tax agent services exposure draft Bill, associated draft regulations, the key consequential and transitional provisions supporting the exposure draft, and relevant explanatory materials.
"The proposed reforms aim to improve the registration and regulation of entities providing tax agent services which will provide greater protection and certainty to consumers and increased consistency in registration and appropriate, but flexible regulation for entities providing tax agent services," Mr Bowen said.
The key elements of the regulatory reforms encapsulated in this package are:
- a national Tax Practitioners Board (the Board) to replace the existing state-based boards;
- registration and regulation of entities providing Business Activity Statement (BAS) services as BAS agents;
- a legislated Code of Professional Conduct to govern tax agents and BAS agents;
- a wider and more flexible range of disciplinary sanctions which may be imposed by the Board;
- civil penalties and injunctions to replace criminal penalties for certain misconduct by agents and unregistered entities; and
- ‘safe harbours’ which provide that, in certain circumstances, taxpayers who engage a tax agent or a BAS agent are not liable to certain administrative penalties that would otherwise ordinarily apply for making a false or misleading statement resulting in a tax shortfall amount, or for lodging a document late.
This package has been developed through extensive consultation with tax professional associations, tax practitioners, government agencies and taxpayers.
Comments previously received have led to several improvements being made to the exposure draft package.
An outline of the key changes made to the draft materials since public consultation in mid-2007 is attached.
The Government now seeks further and final submissions from interested parties. Copies of the consultation materials are available from the Treasury website (www.treasury.gov.au) or may be obtained from the project team by telephoning 02 6263 3356.
Written comments on the consultation materials should be sent by 27 June 2008 and may be submitted by mail, facsimile or email to:
The General Manager
Business Tax Division
The Treasury
Langton Crescent
PARKES ACT 2600
Fax: 02 6263 4466
Email: taxagentservices@treasury.gov.au
29 May 2008
Contact: James Cullen - 0409 719 879
Attachment
KEY CHANGES TO THE EXPOSURE DRAFT MATERIALS FOLLOWING PREVIOUS PUBLIC CONSULTATION ON THE PROPOSAL
The exposure draft and associated regulations and consequential and transitional provisions have been amended in a number of respects following public consultation on an earlier exposure draft package.
The key amendments are outlined below.
- The independence of the Tax Practitioners Board (the Board) from the Commissioner of Taxation (the Commissioner) has been enhanced by drafting the exposure draft to be a separate Act rather than part of the Taxation Administration Act 1953 and vesting the general administration of the provisions of the Bill in the Board rather than in the Commissioner. Creating a stand alone Act provides the opportunity to re‑arrange the provisions in the exposure draft to improve its flow.
- Adjustments have been made to the definitions of ‘tax agent service’ and ‘BAS service’ to clarify their scope. The definitions include tax advice which is provided based on hypothetical circumstances, and exclude services which do not require the application of a certain degree of knowledge and experience in interpreting the taxation law.
- Certain aspects of the registration system have been adjusted and simplified, including:
- removing the requirement to ‘carry on a business’;
- removing the separate category of ‘nominee’ registration, which is redundant with the removal of the ‘carry on a business’ requirement;
- replacing the ‘sufficient resources’ requirement for registration of partnerships and companies with a more specific and relevant requirement that the entity has a sufficient number of registered individuals; and
- giving the Board the power to impose conditions on the registration of a ‘specialist’ tax agent or BAS agent, to ensure that they only practise in their specialised area of taxation law or their specialised type of tax agent service.
- The wording of several of the provisions in the Code of Professional Conduct have been narrowed or otherwise adjusted to make clearer the obligations of tax agents and BAS agents. The focus of the provisions is more on the outcome rather than the process.
- The consequential and transitional provisions supporting the exposure draft now include an additional ‘safe harbour’ from administrative penalty for taxpayers for the late lodgment of a document in the approved form resulting from a tax agent’s or a BAS agent’s careless error.
- Arrangements relating to the provision of continuing professional education for the purposes of complying with the Code of Professional Conduct have been revised to make it clear that the Board may accredit any tax related courses that it considers are appropriate for continuing professional education purposes.