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A coalition of 10 bodies has written an open letter to the Assistant Treasurer demanding the withdrawal of his changes to the code of conduct.
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Professional bodies unite to demand reversal of code changes
17 July 2024
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The government is facing mounting pressure to walk back changes to the tax agent code of conduct after professional bodies united to demand the Assistant Treasurer withdraw his legislative instrument and host “urgent” talks with the industry.
A coalition of 10 bodies representing the accounting and tax industry united on Tuesday to oppose the instrument, penning an open letter to Stephen Jones that laid out their “strong concerns” over the changes affecting practitioners’ disclosure, confidentiality and record-keeping obligations.
It comes as practitioners launched their own grassroots campaign against the changes, with a Change.org petition started by accounting software outfit ChangeGPS gaining over 1,000 signatures in two days.
The controversy stems from a determination made by Jones, registered on 2 July, under section 30-12 of the Tax Agent Services Act (TASA), which allows him to modify the code with a legislative instrument.
According to the instrument’s explanatory material, the determination “supplements” the code to curb tax practitioner misconduct without creating “any new obligations on tax practitioners that are inconsistent with their obligations under the code”.
TPB chairman Peter de Cure has also told Accountants Daily the instrument does not create any inconsistencies because it had the effect of overriding existing obligations.
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But the joint bodies’ open letter maintained the current instrument needed overhauling.
“We continue to hold significant concerns about the legislative instrument and the detrimental aspects that outweigh the improvements made,” it said. “To further constructive collaboration, the joint bodies request urgent discussions.”
“We request the minister withdraw the legislative instrument as registered.”
The open letter to Jones features members of the TPB’s governance and standards forum: CA ANZ, CPA Australia, the Institute of Public Accountants and the Tax Institute, Australian Bookkeepers Association, Institute of Certified Bookkeepers, Institute of Financial Professionals Australia, Financial Advice Association of Australia, NTAA PLUS and SMSF Association.
It took issue with the “unrealistic and unachievable” 1 August start date and the “extremely concerning” obligation under section 45 of the instrument to keep clients informed of “all” matters and its retrospective application, capturing matters from 1 July 2022.
“The retrospective nature of the legislative instrument and the commencement date of 1 August 2024 places a significantly onerous and impracticable requirement on tax practitioners,” it said.
The obligation under section 15(2)(c) forcing practitioners to report clients to the ATO if they refused to correct materially false statements was also introduced without consultation and may conflict with existing confidentiality rules, they argued.
Additionally, they said expanded record-keeping requirements were a “significant overreach” for small practices and could conflict with privacy, security and data minimisation policies.
The letter demanded a minimum six-month delay to the start date to allow for further consultation and guidance from the TPB and prevent practitioners from having to self-report their breaches in line with new “dob-in” obligations.
“It is unreasonable that tax practitioners are expected to comply with their new obligations without any available guidance from the TPB and leaves little time for tax practitioners to understand and implement the required substantive changes during tax time which is a particularly busy period in assisting clients meet their tax obligations.”
Meanwhile, the accountants behind software providers ChangeGPS, owned by The Access Group, have begun their campaign to get the changes overturned.
A Change.org petition, titled “Stop the Unfair New Tax Rules Affecting Small Accounting Practices”, has netted over 1,000 signatures since it was started on Monday.
It demanded clarity to section 45, regulation proportionate to the size of accounting practices and that the minister reverted to “normal consultation and have their powers removed and reverted back to the existing framework”.
“We, the undersigned, are calling for urgent action to address the unfair and unworkable new tax rules,” it said.
“Community, mum and dad small businesses and everyday Australians will miss out on essential tax advice if the Assistant Treasurer gets his way.”
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