Australia’s leading accounting industry bodies are calling on Prime Minister Anthony Albanese to end what they call an “unfair attack” on tax agents, in a new open letter challenging reforms to the rulebook applied to accountants and bookkeepers.
The letter significantly escalates a public campaign against the planned changes, but the office of Minister for Financial Services Stephen Jones says some of the groups’ most pressing concerns are unfounded.
The open letter, signed by groups including CPA Australia, Chartered Accountants Australia and New Zealand, and the Institute of Certified Bookkeepers, emerges from the fallout of a recent ministerial directive signed by Minister Jones.
That directive — the Tax Agent Services (Code of Professional Conduct) Determination — applies eight new rules to tax agents, on top of the Code of Professional Conduct currently administered by the Tax Practitioners Board (TPB).
Changes include new requirements for tax agents to flag incorrect statements made by their clients to the Australian Taxation Office, rules requiring the disclosure of matters that could influence a client’s decision to engage a tax agent, and upgraded client record-keeping practices.
Vocal opposition from accounting and bookkeeping leaders led Minister Jones to postpone the directive’s start date from August 1 and consult with concerned parties, on top of the meetings conducted before the directive was signed.
Yet the industry groups are not convinced the postponed start-date, and guidance being prepared by the TPB, will protect small practices from the new requirements.
The new rules “overreach in a way that is deeply concerning”, says the open letter.
It purports that legal advice, obtained by the groups, shows the determination could require tax agents to disclose matters pertaining to their mental health to clients.
“They could also force tax practitioners to publicise investigations into complaints against them, no matter how spurious or vexatious,” it continues.
It says that further consultation with Minister Jones, set for Friday, is welcome.
“However, failing agreement, we will be seeking for these unfair rules to not proceed as they currently stand.”
The groups called on Prime Minister Albanese to “stop in and stop this unfair attack”, adding that if the rules are not significantly reworked, they will call on parliamentarians to support a Coalition-led bid to formally disallow the directive on September 10.
In a statement provided to SmartCompany, a spokesperson for Minister Jones said the “modest” changes are designed to close gaps in Australian law exposed by the PwC tax scandal.
Minister Jones’ office also disputed the claim that elements of the directive, instructing tax agents to inform their clients of “any matter that could significantly influence a decision of a client to engage you”, would force accountants to disclose matters unrelated to their work.
“The Minister has been clear that tax practitioners are not required to disclose mental health matters, sexual orientation, or religious views,” the spokesperson said.
“They will be required to disclose things like a criminal conviction or being charged for committing tax fraud.”
Earlier, guidance prepared by the TPB confirmed tax practitioners will not need to tell clients of their physical or mental health issues.
In cases where a tax agent must postpone services due to their health issues, “tax practitioners are not required to disclose to their clients, personal information about their health,” the TPB added, emphasis their own.
Beyond the consultations between the accounting groups and Minister Jones’ office, the TPB is currently consulting on three obligations listed under the determination.
Those consultations close on September 24, with further TPB consultations over the new obligations taking place in the months ahead.
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Senior Business Journalist
Focused on the small business sector, David’s work covers the political, regulatory, and economic issues facing Australian entrepreneurs. Prior to joining SmartCompany, he was a reporter for Business Insider Australia. You can follow him on LinkedIn.
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