Footnotes

Chapter 1 - Introduction

[1]        House of Representatives, Votes and Proceedings, 2010-11-12-13, No. 171 (6 June 2013), p. 2383–84. The amended bill was subsequently passed by the House of Representatives and is currently before the Senate.

[2]        House of Representatives, Votes and Proceedings, 2010-11-12-13, No. 171 (6 June 2013), p. 2387.

[3]        A BAS service is a tax agent service 'that is limited in its application to BAS provisions in the taxation laws'; explanatory memorandum, paragraph 3.11.

[4]        Tax Agent Services Regulations 2009, r. 13(2). The disclaimer must state that (a) the provider of the advice is not a registered tax agent under TASA; and (b) if the receiver of the advice intends to rely on the advice to satisfy liabilities or obligations or claim entitlements that arise, or could arise, under a taxation law, the receiver should request advice from a registered tax agent.

[5]        Essentially, the proposed definition for this term incorporated the elements of a tax agent service (a defined term in TASA) to the extent that the service provided by a financial services licensee (or a representative) relates to ascertaining an entity's tax liabilities and advising an entity about their actual and potential tax liabilities—that is, the definition does not encompass the third function of a tax agent service which is to represent an entity in their dealings with the ATO. The proposed definition is examined further in chapter 3.

[6]        Explanatory memorandum, paragraph 3.47.

[7]        Explanatory memorandum, paragraph 3.75. The Code is contained in Division 30 of TASA.

[8]        Explanatory memorandum, paragraphs 3.149, 3.154. The disclaimer is similar to that which financial advisers currently give clients under the carve out from TASA, however, the wording is updated to reflect the new term 'registered tax (financial) adviser'.

Chapter 2 - The need for reform

[1]        Tax Agent Services Act 2009, s. 2-5.

[2]        Explanatory memorandum, paragraphs 3.13, 3.15.

[3]        A BAS service is a tax agent service 'that is limited in its application to BAS provisions in the taxation laws'; explanatory memorandum, paragraph 3.11.

[4]        The explanatory memorandum notes that this was intended as 'an interim measure, and to provide time to develop a suitable regulatory framework that takes into account the existing regulatory regime in the Corporations Act 2001 ... applying to those in the financial services industry'. The carve out expires on 30 June 2013. See explanatory memorandum, paragraphs 3.16–3.18.

[5]        Explanatory memorandum, paragraphs 4.11–4.12.

[6]        CPA Australia and the Institute of Chartered Accountants Australia, Submission 9, p. 2.

[7]        Mr Robert Jeremenko, Senior Tax Counsel, The Tax Institute, Proof Committee Hansard, 12 June 2013, pp. 26, 27.

[8]        The Hon Bill Shorten MP, 'Future regulation of financial planners providing tax advice', Media release, 2011 no. 49 (7 April).

[9]        Financial Services Council, Submission 7, p. 4.

[10]      Explanatory memorandum, paragraphs 4.18.

[11]      Mr Gerry Antioch, General Manager, Tax System Division, Treasury; Mrs Leslie Macdonald, Manager, Tax Administration Policy Unit, Treasury, Proof Committee Hansard, 12 June 2013, p. 35.

[12]      Mr Mark Rantall, Chief Executive Officer, Financial Planning Association of Australia, Proof Committee Hansard, 12 June 2013, pp. 14–15.

[13]      Mr Robert Jeremenko, Senior Tax Counsel, The Tax Institute, Proof Committee Hansard, 12 June 2013, p. 29.

[14]      Mr John Brogden, Chief Executive Officer, Financial Services Council, Proof Committee Hansard, 12 June 2013, p. 5.

[15]      Ms Cecilia Storniolo, Senior Policy Manager, Financial Services Council, Proof Committee Hansard, 12 June 2013, p. 1.

[16]      Mr Yasser El-Ansary, General Manager, Leadership and Quality, Institute of Chartered Accountants Australia, Proof Committee Hansard, 12 June 2013, p. 23.

[17]      Mr Gerry Antioch, General Manager, Tax System Division, Treasury, Proof Committee Hansard, 12 June 2013, p. 34.

[18]      Mrs Leslie Macdonald, Manager, Tax Administration Policy Unit, Treasury, Proof Committee Hansard, 12 June 2013, p. 33.

[19]      Explanatory memorandum, paragraph 4.51.

[20]      ASIC also advised that there is a total of 59,564 links to AFSL holders—the higher number for links than what would be reached if the number of AFSL holders and authorised representatives were simply added together is 'due to the fact that some are authorised representatives of more than one licensee'. ASIC, answer to question on notice, Inquiry into the Corporations  Amendment (Simple Corporate Bonds and Other Measures) Bill 2013, received 13 May 2013, p. 1. See Financial Planning Association, Submission 8A, p. 1.

[21]      CPA Australia and the Institute of Chartered Accountants Australia, Submission 9, p. 1.

[22]      The Tax Institute, Submission 5, p. 2.

[23]      Mr Philip Anderson, Chief Operating Officer, Association of Financial Advisers, Proof Committee Hansard, 12 June 2013, p. 8.

[24]      Mr John Brogden, Chief Executive Officer, Financial Services Council, Proof Committee Hansard, 12 June 2013, pp. 1, 7.

[25]      Mr Paul Drum, Head of Policy, CPA Australia, Proof Committee Hansard, 12 June 2013, pp. 19–20, 21.

[26]      Mr John Brogden, Chief Executive Officer, Financial Services Council, Proof Committee Hansard, 12 June 2013, p. 3.

Chapter 3 - Key issues

[1]        Asterisks are used in TASA to identify defined terms. The definitions of these terms are compiled in Division 90 of that Act.

[2]        Explanatory memorandum, paragraph 3.32

[3]        Explanatory memorandum, paragraph 3.44.

[4]        Explanatory memorandum, paragraph 3.47.

[5]        Explanatory memorandum, paragraph 3.41.

[6]        Explanatory memorandum, paragraph 3.43.

[7]        Financial Services Council, Submission 7, p. 7.

[8]        Financial Services Council, Submission 7, p. 16.

[9]        Financial Services Council, Submission 7, p. 16.

[10]      Ms Cecilia Storniolo, Financial Services Council, Proof Committee Hansard, 12 June 2013, p. 3.

[11]      Mr Phil Anderson, Association of Financial Advisers, Proof Committee Hansard, 12 June 2013, p. 8.

[12]      Mr Mark Rantall, Chief Executive Officer, Financial Planning Association, Proof Committee Hansard, 12 June 2013, p. 15.

[13]      Australian Bankers' Association, Submission 10, p. 2.

[14]      Ms Cecilia Storniolo, Senior Policy Manager, Financial Services Council, Proof Committee Hansard, 12 June 2013, p. 3.

[15]      Financial Services Council, Submission 7, p. 19.

[16]      Mr Philip Ackroyd, Adviser, Revenue Group, Law Design Practice, Treasury, Proof Committee Hansard, 12 June 2013, p. 30.

[17]      Mr Philip Ackroyd, Treasury, Proof Committee Hansard, 12 June 2013, p. 31.

[18]      Mr Philip Ackroyd, Treasury, Proof Committee Hansard, 12 June 2013, p. 31.

[19]      Ms Joanna Bird, Senior Executive Leader, Australian Securities and Investments Commission, Proof Committee Hansard, 12 June 2013, p. 31.

[20]      Explanatory memorandum, paragraph 3.21.

[21]      Explanatory memorandum, 3.87.

[22]      Financial Planning Association of Australia, Submission 8, p. 17.

[23]      Australian Bankers' Association, Submission 10, p. 2.

[24]      Financial Services Council, Submission 7, pp. 23–24.

[25]      Corporations Act 2001, s. 961B. ASIC's regulatory guide explains that in terms of the 'safe harbour' provision the adviser may additionally need to:

(a) explain clearly to the client the advice service that is and is not being provided;

(b) if the advice includes a product recommendation, provide related strategic recommendations that benefit the client;

(c) depending on the subject matter of the advice, specify in the advice that the client should review any decision made about financial products on the basis of the advice provided: (i) once after a period of time; (ii) regularly (e.g. every one or two years); or (iii) if the client’s circumstances change;

(d) offer to provide advice (or refer the client to someone who can provide advice) on any other key issues identified by the advice provider within the subject matter of the advice sought by the client. Australian Securities and Investments Commission, Licensing—Financial product advisers: conduct and disclosure, Regulatory Guide 175, December 2012, paragraph 340.

[26]      Australian Securities and Investments Commission, Licensing—Financial product advisers: conduct and disclosure, Regulatory Guide 175, December 2012.

[27]      Association of Financial Advisers, Submission 11, p. 4.

[28]      Association of Financial Advisers, Submission 11, p. 4.

[29]      Association of Financial Advisers, Submission 11, p. 4.

[30]      Association of Financial Advisers, Submission 11, p. 4.

[31]      Financial Services Council, Submission 7, p. 10.

[32]      Financial Services Council, Submission 7, p. 10.

[33]      Mr Dante De Gori, General Manager of Policy and Conduct, Financial Planning Association, Proof Committee Hansard, 12 June 2013, p. 16.

[34]      Financial Planning Association, Submission 8, p. 19.

[35]      Australian Bankers' Association, Submission 10, p. 2.

[36]      Mr Paul Drum, Head of Policy, CPA Australia, Proof Committee Hansard, 12 June 2013, p. 19.

[37]      Ms Joanna Bird, Senior Executive Leader, Australian Securities and Investments Commission, Proof Committee Hansard, 12 June 2013, p. 32.

[38]      Mr Yasser El-Ansary, General Manager, Leadership and Quality, Institute of Chartered Accountants Australia, Proof Committee Hansard, 12 June 2013, p. 19; Mr Robert Jeremenko, Senior Tax Counsel, The Tax Institute, Proof Committee Hansard, 12 June 2013, p. 26.

[39]      Explanatory memorandum, paragraphs 3.149, 3.154.

[40]      Explanatory memorandum, paragraphs 3.160–3.161.

[41]      Financial Services Council, Submission 7, p. 35.

[42]      Association of Financial Advisers, Submission 11, p. 5.

[43]      Mr John Brogden; Ms Cecilia Storniolo, Financial Services Council, Proof Committee Hansard, 12 June 2013, p. 6.

[44]      The first statement is certainly correct—the adviser would not a registered tax agent under TASA. The second statement would no longer fully inform the client of the options available to them as it does not acknowledge the existence of tax (financial) advisers and, perhaps, disadvantages registered tax (financial) advisers as the client may not seek advice from them. However, the statement directs the client to a registered tax agent which appears to be an acceptable outcome from a consumer protection perspective given that the tax agent will be qualified to assist the client.

[45]      Mrs Leslie Macdonald, Manager, Tax Administration Policy Unit, Treasury, Proof Committee Hansard, 12 June 2013, p. 35.

[46]      Mr Philip Anderson, Chief Operating Officer, Association of Financial Advisers, Proof Committee Hansard, 12 June 2013, p. 8.

[47]      Financial Planning Association of Australia, Submission 8, p. 20.

[48]      Financial Services Council, Submission 7, p. 26.

[49]      Mrs Leslie Macdonald, Manager, Tax Administration Policy Unit, Treasury, Proof Committee Hansard, 12 June 2013, p. 34.

[50]      Treasury, Proposed registration requirements for registered tax (financial) advisers, Discussion paper, June 2013.

Coalition Members' Dissenting Report

[1]        Financial Planning Association, Submission 8, pp. 6–7.

[2]        Financial Planning Association, Submission 8, p. 7.

[3]        Email of summary points the AFA sent through for hearing (sent 12 June 2013 at 11.54am by Mr Phil Anderson and circulated by Committee Secretariat the same day at 1.24pm.)

[4]        'Delay in tax advice reform jeopardises much-needed consumer protections', Joint Media release, 6 June 2013 by CPA Australia and the ICAA.

[5]        Mr Paul Drum, Head of Policy, CPA Australia, Proof Committee Hansard, 12 June 2013, p. 20.

[6]        Proof Committee Hansard, 12 June 2013, p. 5.

[7]        Proof Committee Hansard, 12 June 2013, p. 17.

[8]        Proof Committee Hansard, 12 June 2013, p. 33.

[9]        Mr John Brogden, Chief Executive Officer, Financial Services Council, Proof Committee Hansard, 12 June 2013, p. 5.

[10]      Email of summary points the AFA sent through for hearing (sent 12 June 2013 at 11.54am by Mr Phil Anderson and circulated by Committee Secretariat the same day at 1.24pm.)

[11]      Email of summary points the AFA sent through for hearing (sent 12 June 2013 at 11.54am by Mr Phil Anderson and circulated by Committee Secretariat the same day at 1.24pm.)

[12]      Mr Mark Rantall, Chief Executive Officer, Financial Planning Association and Mr Dante De Gori, General Manager, Policy and Conduct, Financial Planning Association, Proof Committee Hansard, 12 June 2013, p. 18.

[13]      Mr Yasser El-Ansary, General Manager, Leadership and Quality, Institute of Chartered Accountant Australia, Proof Committee Hansard, 12 June 2013, pp 23–24.

[14]      Financial Planning Association, Submission 8, p. 14.

[15]      Financial Planning Association, Submission 8, p. 14.

[16]      Email of summary points the AFA sent through for hearing (sent 12 June 2013 at 11.54am by Mr Phil Anderson and circulated by Committee Secretariat the same day at 1.24pm.)

[17]      Australian Bankers' Association, Submission 10, pp 1–2.

[18]      Financial Planning Association, Submission 8, p. 14.

[19]      Proof Committee Hansard, 12 June 2013, p. 17.

[20]      Financial Planning Association, Submission 8, p. 19.

[21]      Australian Bankers' Association, Submission 10, p. 2.

[22]      Australian Bankers' Association, Submission 10, p. 2.

[23]      Email of summary points the AFA sent through for hearing (sent 12 June 2013 at 11.54am by Mr Phil Anderson and circulated by Committee Secretariat the same day at 1.24pm.)

[24]      Financial Services Council, Submission 7, p. 29.