Login
iscover
Setting up a separate budget and hiring senior permanent employees are some of the options preferred by the review of the Tax Practitioners Board to ensure independence from the ATO.
Newsletter
Review throws TPB independence into the spotlight
05 August 2019
•
12 minute read
You’re out of free articles for this month
To continue reading the rest of this article, please log in.
Create free account to get unlimited news articles and more!
The independence of the Tax Practitioners Board is a central theme of the current review of the TPB, with submissions highlighting the possible conflict of interest with the ATO due to its many intrinsic ties with the agency, including budget, staff and co-location.
The TPB and the ATO are strongly of the view that concerns raised regarding the former entity’s independence are a matter of perception rather than reality.
However, the recent discussion paper released by independent review chair Keith James notes that the current situation does not meet the requirements of independence as set out by The Ethics Centre.
“Currently, board members and the CEO are paid by the ATO; the MOU between the TPB and ATO has not been updated since 2010; the ATO has ultimate responsibility for the TPB’s budget as the accountable authority under the PGPA Act, and the secondment arrangements need to be improved,” the discussion paper said.
Accordingly, the paper suggests establishing the chair of the TPB as the relevant accountable authority responsible for its own budget and reporting.
It also believes the chief executive of the TPB should be a statutory appointment that is made either by the board or by the relevant minister, with staff of the TPB who report directly to the CEO and are responsible for decisions regarding sanctions and litigation are also employees of the TPB rather than ATO secondees working for the TPB.
==
==
“This would ensure that all decisions that may be made by the TPB and that are appellable to either the AAT or a court are made by employees of the TPB who are clearly independent of the ATO,” it said.
However, the discussion paper believes there is an advantage to allow TPB staff to be located in ATO offices.
Apart from significant infrastructure cost savings, co-location would “encourage and facilitate a close working relationship allowing both agencies to continue to collaborate and consult effectively”.
Chartered Accountants Australia and New Zealand tax leader Michael Croker said the discussion paper asks the right questions when it comes to whether the TPB’s links with the ATO is an impairment of its independence.
“The independence of the TPB is a foundational necessity so that tax practitioners and everyday taxpayers have confidence in the integrity of the tax system,” Mr Croker said.
“We need the peace of mind that this important regulatory role is being carried out fairly, objectively and with accountability to the TPB alone.
“The increased focus on whether the TPB remains fit for purpose formed part of our initial submission to the review, and we welcome its inclusion in the discussion paper.”
The discussion paper has also raised the proposal of increasing the minimum primary education qualification for tax and BAS agents, along with introducing new sanction tools to allow the TPB to be more agile in dealing with egregious or unregistered practitioners.
All parties with an interest in the review are urged to make a submission on the discussion paper, which can be found on the Treasury’s website.
You are not authorised to post comments.
Comments will undergo moderation before they get published.