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The Assistant Treasurer has vowed to improve the way the ATO interacts with tax agents and ensure that due respect is given to the profession.
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Assistant Treasurer puts ATO on notice over tax profession interaction
02 December 2019
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In an address to the Institute of Public Accountants National Congress 2019, Assistant Treasurer Michael Sukkar said it was vital for the ATO to give tax professionals the recognition and respect they deserve as trusted advisers of over 4 million small businesses.
“I am dedicated and have been working very closely with the ATO to make sure the status that I think you deserve in our ecosystem of tax and regulatory regime is respected by the ATO and is given the due difference that you deserve,” Mr Sukkar said.
“I’m very keen to make sure that at the end of this term, you’ll at least see an acknowledgement and some substantive improvements to the way that you interact with the ATO which, let’s be frank, is probably by design and by reality, one of the most, if not the most, powerful organisation in this country.
“The fact that you engage with them on a daily basis is something that we and I want to make as easy as humanly possible, noting that there are some limits to that, but that’s what I’ll be progressing over the next two years, and I really ask for your encouragement and feeding the ideas through and complaints where necessary to make sure we are doing everything we can to move the pendulum in the right direction.”
Mr Sukkar’s comments come after IPA chief executive Andrew Conway called for a structural rethink at the Tax Office to drive a change in culture and improve the way tax agents are treated.
Tax practitioners have taken issue with ATO analysis that argues that agent-prepared returns require more adjustments than self-prepared returns.
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Commissioner Chris Jordan’s criticism of agents for failing to be “guardians of the system” has also not sat well with the profession.
More recently, Mr Jordan claimed that his agency’s audit of over 300 rental property claims found errors in almost nine out of 10 returns reviewed, despite 85 per cent of taxpayers with rental properties being represented by a tax agent.
The Assistant Treasurer’s predecessor, Stuart Robert, had last year promised to hold the Commissioner of Taxation to concept of “grace”, in response to complaints around the ATO’s interaction with the profession.
Mr Sukkar, a former senior consultant at big four firm PwC, said he understood the importance of tax agents in Australia’s self-assessment system and promised to ensure the profession would not be bullied into submission.
“I am a former tax practitioner and I started out at PwC doing tax returns and I wasn’t great at it, but I suppose I was on the front line of many of the issues that you are dealing with,” Mr Sukkar said.
“Now that I sit on the other side of the table, it is remarkable to me how flexible you are as a group of professionals that you are constantly able to evolve and are able to just deal with challenges that are often imposed by government or by regulators and how you are able to deal with those and plough ahead and move on.”
He added: “That’s a strength and a weakness.
“The strength is that you are able to keep serving your clients in a way that puts you at the centre of most small business’s lives that doesn’t happen in other countries.
“The weakness is that I suspect you are all working longer, harder, driving efficiencies for your own organisations and perhaps not being remunerated for that additional effort.
“Part of that is because of cultural issues and interactions with the ATO and perhaps not a recognition of just how important you are to our self-assessment system.
“Your ability to plough through all those challenges thrown at you mean that governments think ‘they’ll be OK’, and organisations like the IPA are extraordinarily important in knocking on our doors in Canberra, as Andrew and his team do regularly, reminding us that’s not the case and like all things, there’s a breaking or tipping point if things don’t change.”
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