Increased TPB penalties will create mental health issues
Proposals to increase the civil penalties available to be imposed by the Tax Practitioners Board (TPB) risk adversely impacting tax practitioners’ mental health and reducing the appeal of the tax accounting profession to new entrants.
A submission from the so-called Joint Bodies representing the major accounting groups plus the Financial Advice Association of Australia and the SMSF Association has told Treasury that the proposed penalties are unreasonably high.
As well, the joint submission argues that the increased penalties will have the effect of driving up the cost of professional indemnity (PI) insurance.
“The TASA civil penalties are proposed to be substantially increased and will equate to the promoter penalties, which apply to conduct that is among the most egregious tax practitioner behaviour.,” it said.
“Transposing penalties of this amount across the whole ambit of the TASA (Tax Agent Services Act) does not recognise the spectrum of wrongdoing that can occur.”
“We consider that unreasonably high penalties, increasing risk and financial pressures, may: • adversely impact tax practitioners’ mental health, impeding their ability to provide adequate services, and affect the resilience of the profession overall, and its appeal as a profession for new entrants; and
- substantially increase the cost of professional indemnity insurance
The joint bodies went on to argue that the proposed penalty regime was inappropriate for the many small to medium-sized businesses in the tax accounting space and suggested that at least two proportionate bands be introduced.
“The proposed increases in the maximum civil penalty amounts are 10-fold for individuals and 40-fold for companies, which, in our view, is excessive.,” it said.
“We recommend that the maximum civil penalty amounts be increased by no more than five-fold for individuals, and no more than 10-fold for companies. This element could be revisited in the future depending on the impact of the changes over time and the extent to which they are effective in changing behaviours.”
Accountants got it so good give advice – only verbal make a mistake just blame the client said they didn’t listen. Any advice given by the accountant client still responsible in the event of an audit. You can’t make this stuff up, accountants help clients with illegal phoenix activity. illegal Ponzi scheme and also scams. Do you think all these client and the volume at which this stuff happens with the help of Accountants and lawyers? They happen to open and shut company structures, open up trusts without advice.. please get in the real world.
Client need better protection and also the customers that fall victim to these “professionals” doing the wrong thing need a Royal commission.
It’d be good if the article mentioned the dollar figure . What’s the existing penalty?
ASIC and AFCA have been causing mental health breakdowns and suicide for years with financial planners. Hopefully they don’t go too far with accountants but in reality governments and public servants don’t care so they probably will.