Fit­ting the (amended) Bill

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THE LE­GAL PRO­FES­SION is breath­ing eas­ier af­ter the pub­li­ca­tion of a sec­ond draft of the Tax Prac­ti­tion­ers’ Bill, which seeks to reg­u­late that pro­fes­sion. At is­sue was the be­lief held by SA Rev­enue Ser­vice that many peo­ple are act­ing as tax prac­ti­tion­ers who aren’t qual­i­fied to of­fer ad­vice in a tax en­vi­ron­ment that’s be­come highly com­plex and so­phis­ti­cated over re­cent years.

Robin Beale, a con­sul­tant to au­dit firm PKF, says the vast ma­jor­ity of tax prac­ti­tion­ers are qual­i­fied at­tor­neys or char­tered ac­coun­tants and al­ready reg­u­lated by the Law So­ci­ety or SA In­sti­tute of Char­tered Ac­coun­tants (Saica) re­spec­tively, leav­ing only a small mi­nor­ity not al­ready reg­u­lated un­der those highly-re­garded self-reg­u­lat­ing or­gan­i­sa­tions.

Says Beale: “There are in­deed many book­keep­ers and non-Saica reg­is­tered ac­coun­tants who do the tax re­turns for small busi­ness clients and typ­i­cally do a sat­is­fac­tory job.”

The le­gal pro­fes­sion’s con­cern was that the Bill posed an at­tack on its in­de­pen­dence and client priv­i­lege in or­der to reg­u­late a mi­nor­ity of the ac­count­ing pro­fes­sion.

There were other is­sues at stake, notably the pro­vi­sion that tax prac­ti­tion­ers re­port to Rev­enue any ir­reg­u­lar­i­ties they came across in con­sult­ing to a client. David French, as­so­ciate di­rec­tor at Ernst & Young Tax Tech­ni­cal Ser­vices, says that pro­voked par­tic­u­lar re­sis­tance from the tax

pro­fes­sion. “The sec­ond draft of the Bill has re­moved many of the con­cerns of the pro­fes­sion and no longer seeks to turn us into ‘tax po­lice’. The new Bill looks a lot eas­ier to im­ple­ment, though it’s not without dif­fi­cul­ties for the tax pro­fes­sion,” says French.

Most tax prac­ti­tion­ers ap­pear sup­port­ive of the con­cept of reg­u­la­tion and the cur­rent think­ing of SA’s law­mak­ers ap­pears to favour al­low­ing lawyers and CAs to be reg­u­lated by their own gov­ern­ing bodies, as op­posed to cre­at­ing a new and un­nec­es­sary layer of over­sight that would in­evitably over­lap the Law So­ci­ety and Saica.

“We think there’s merit in the reg­u­la­tion of tax prac­ti­tion­ers from the per­spec­tive of en­sur­ing peo­ple have the right qual­i­fi­ca­tions and ex­pe­ri­ence to do the job. It would rid the pro­fes­sion of un­qual­i­fied peo­ple,” says French.

Der­mot Gaffney, head of KPMG’s in­di­rect tax prac­tice, en­dorses that view but adds a con­cern that the draft Bill is some­what parochial in its lack of recog­ni­tion of for­eign qual­i­fi­ca­tions. Large ac­count­ing firms – be­ing as multi­na­tional as they are – fre­quently re­lo­cate pro­fes­sional staff be­tween coun­tries.

Gaffney says peo­ple with over­seas qual­i­fi­ca­tions won’t qual­ify as tax prac­ti­tion­ers un­der the Bill. “ That’s a fur­ther bar­rier to the im­por­ta­tion of skills. Tax law doesn’t vary that much from coun­try to coun­try – and how long can it take to learn the dif­fer­ences? There should be proper recog­ni­tion un­der leg­is­la­tion in align­ment with those for­eign pro­fes­sional bodies recog­nised by Saica.”

A fur­ther bar­rier to the im­por­ta­tion of skills. Der­mot Gaffney

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