The SMSF Association has backed investing the Tax Practitioners Board (TPB) with greater powers arguing that it is important that tax practitioners not be sheltered from change or greater scrutiny.
In a submission filed as part of the Treasury’s review of the TPB, the SMSF Association said it was important that the TPB “is a proactive and effective regulatory body to ensure misbehaviour which has occurred in other industries does not occur in the highly respected tax agent industry.”
“It is therefore important the TPB does not seek to shelter tax practitioners from change or greater scrutiny expected by the public,” the submission said.
The SMSF Association said the TPB had typically been perceived to be a low profile and tightly resourced regulator and cautioned that “this may lead to perceptions from the tax agent profession that they are unlikely to be penalised with serious contraventions that affect their daily practice.”
“As highlighted by the Royal Commission, one hallmark of a profession is the existence of a credible and coherent system of professional discipline – the ultimate sanction being expulsion. Experience shows that those who feel they are unlikely to face consequences for their poor conduct are much more likely to engage in that conduct,” the SMSF Association submission said.
It said the TPB’s disciplinary feature was a positive for the sector because it was important for regulators to be seen to be acting in a supervisory capacity in order for there to be trust in the regulators from consumers.
“Furthermore, individuals are more likely to complain to an independent regulator such as the TPB rather than a professional association,” the SMSF Association said. “We support the disciplinary regime of the TPB which can ultimately cancel a tax practitioner’s registration and believe the TPB should not shy away from this process.”
It said this would be important in the context of the TPB having completed the backlog of registrations built up from transitioning tax financial advisers into the regime.