The Australian Parliament introduced the Tax Accountability and Fairness Bill 2023 by Assistant Treasurer Stephen Jones.
According to Accounting Times, this move, catalysed by the PwC tax scandal, marks a pivotal step in addressing tax adviser misconduct and fortifying the integrity of Australia’s tax system.
Described by Mr Jones as the “biggest government crackdown on tax adviser misconduct in Australian history”, the bill aims to remedy the vulnerabilities exposed by the PwC scandal. The proposed legislation underscores the need for accountability not only among multinational companies but also tax advisers, whose actions play a crucial role in the efficacy of the tax system.
A key feature of the bill is the amendment of promoter penalty provisions. This includes extending the timeframe for the Australian Taxation Office (ATO) to initiate civil penalty proceedings in the Federal Court and increasing the applicable maximum penalties. Furthermore, the bill expands the scope of these laws to encompass more tax exploitation schemes, especially those falling under the multinational anti-avoidance law (MAAL) or diverted profits tax (DPT).
The bill also proposes significant changes to whistleblower protections, expanding them to cover disclosures to the Tax Practitioners Board (TPB) and other supporting entities. This enhancement aims to encourage and safeguard individuals who come forward with crucial information on tax misconduct.
In tandem with these tax reforms, the Superannuation (Objective) Bill 2023 was also introduced. Treasurer Jim Chalmers emphasized its significance, stating the bill’s objective is to “preserve savings to deliver income for a dignified retirement.” This measure seeks to instil a stable and clear direction for superannuation, promoting equitable and sustainable retirement savings and preventing short-sighted policies that have previously plagued the system.
These legislative proposals represent a monumental step in reforming Australia’s financial landscape. They not only aim to bolster the country’s tax and superannuation systems but also restore public trust in these crucial sectors.
Assistant Treasurer Stephen Jones said, “The PwC scandal exposed several shortcomings in Australia’s regulatory frameworks, and that undermines community confidence in our tax system. It showed that it is not only the multinational companies, but also the tax advisers that need to be held accountable for their actions.”
Treasurer Jim Chalmers said, “Legislating an objective of super will help prevent this sort of short sightedness ever happening. The objective will help ensure super delivers on its foundational promise of providing a dignified retirement for more Australians. It will secure super’s future by embedding its purpose into law.”
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