Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Government in the Senate) Share this | Hansard source

Firstly, I would like to thank all senators who have contributed to this debate, particularly Senator McEwen for her contribution. The Tax Agent Services Bill 2008 aims to improve the regulatory environment for the provision of tax agent services of the current regime, which was introduced in 1943. Think about that: we have a regime here dating from 1943—it is a little out of step with the contemporary tax and commercial environment! The bill will ensure that tax agents’ services are provided in accordance with appropriate professional and ethical standards.

The bill will improve the regulatory environment through the establishment of a national Tax Practitioners Board, which will provide consistency in the registration and regulation of tax agents and other intermediaries in the tax field. You just have to look at the papers to see the sort of tax practices being recommended by many so-called high-profile tax agents—the Bermuda trusts that they encourage people towards. We are having to have an entire enforcement regime dealing with the activities of schemes promoted by some tax agents, so this is a particularly relevant bill at the moment.

The bill requires that entities providing business activity statement services for a fee must register. It ensures a level playing field and realigns the scope of regulation with the expansion of the tax base and other changes to the tax system over recent decades.

The legislative code of professional conduct established under the bill provides certainty to both agents and taxpayers. Agents will be given clarity about the standard of conduct expected of them and taxpayers will have a benchmark against which they can evaluate the services that they receive. It is very important that, when you are looking to employ a tax agent, you know that they are registered and you know that they understand their professional and ethical standards. We do not want to see the proliferation that we have in recent times, where some fly-by-nighters spend their time trying to actively promote illegal evasion. That is not to deny the right of people to access the deductions that they are entitled to. What we are talking about here is people who go out of their way to set up scams and false activities that evade tax. That is why this is such an important bill.

The introduction of a range of constructive and educative administrative sanctions allows the new board flexibility to respond appropriately to breaches of the code. The application of civil penalties instead of the existing criminal penalties for certain specified misconduct by registered agents and unregistered entities will provide an effective deterrent against engaging in prohibited conduct. That is one of the really important steps forward that we are seeing through this legislation. The criminal penalties have not necessarily been able to be enforced as well as I am sure the original legislators had hoped. The capacity to impose civil penalties for misconduct by registered agents and, importantly, unregistered entities should begin to assist, promote and protect the integrity of the tax base. The vast majority of taxpayers are interested in protecting the integrity of the tax base.

The Tax Agent Services Bill 2008 is the culmination of an extensive consultation process that commenced in 1992. I see Senator Coonan here in the chamber. It has been a long time since 1992, Senator Coonan.