Snapshot
- In the wake of the PwC controversy, recent tax reforms signal a tax avoidance offensive by regulators.
- Most notably, the changes have dramatically escalated the stakes for contravening the rules on promoting tax exploitation schemes by increasing penalties and lowering the threshold.
- Practitioners — and not just those who specialise in tax — ought to familiarise themselves with these amendments, as they may unwittingly risk finding themselves subject to increasingly large penalties.
On 31 May 2024, Royal Assent was granted to the Treasury Laws Amendment (Tax Accountability and Fairness) Act 2024 (Cth) (‘the Act’), the latest tranche of Commonwealth legislation responding to the fallout of the PwC controversy (referred to in the explanatory memorandum as the ‘PwC tax leaks scandal’). The Act seeks to strengthen the integrity of the federal tax system and to reform the regulatory regime that applies to tax practitioners and tax promoter penalties.
The Act makes four categories of amendments to federal tax law, namely:
- reforms of the promoter penalty regime;
- alterations to and extensions of tax whistleblower protections;
- reforms of the investigative powers of the Tax Practitioners Board (‘TPB’) and the register it maintains; and
- amendments to facilitate the sharing of information between, for example, government and professional disciplinary bodies.
Practitioners — and not just those who specialise in tax — ought to familiarise themselves with these amendments, as they may unwittingly risk finding themselves subject to increasingly large penalties. This article aims to highlight some of the key changes and provide some preliminary observations on the topics raised and potential for further reform.
