The role of CPA Australia in tax policy

By Elinor Kasapidis

In his magnum opus The Wealth of Nations, economist Adam Smith wrote of the effort made by governments, “to the best of their judgement, to render their taxes as equal they could contrive; as certain, as convenient to the contributor… and in proportion to the revenue which they brought to the prince, as little burdensome to the people”.

Taxation is a much analysed, contentious and politicised area of public policy, with ever-evolving theories and approaches being discussed by everyone – from the person on the street, to those charged with leading our nation.

CPA Australia is committed to engaging with policymakers, regulators and administrators to support both members and the public interest in developing optimal tax frameworks, tailored to the needs of each region in which we operate. CPA Australia’s policy positions are underpinned by the principles of fairness, certainty, convenience and efficiency, as articulated in the Review of Australia’s Future Tax System (2009).

CPA Australia and its members engage in informed debate on tax issues that can be broadly categorised under policy, legislation, administration and operations.

Policy

CPA Australia has regular engagement with government and opposition parties, key policymakers, academics, fellow professional associations, government bodies – such as the Board of Taxation – and CPA Australia members, including through its Taxation Centre of Excellence and Tax Committees. Together with these stakeholders, CPA Australia identifies opportunities for improvements and reforms to the system.

In Australia, reviews of parts of the tax system are often commissioned by the government, and CPA Australia provides expert professional input to inform findings, which often become the basis of legislative reform.

 

"Policy engagement gives a fantastic opportunity to ensure that our practical issues are put forward, and that we can help contribute to bettering the system.” 

 

In a recent CPA Australia webinar on tax policy, Alexis Kokkinos, chair of CPA Australia’s Taxation Centre of Excellence and executive director at Pitcher Partners, said, policy engagement “gives a fantastic opportunity to ensure that our practical issues are put forward, and that we can help contribute to bettering the system. At the end of the day, the tax system is there for all of us as well, so we want to make sure that there’s appropriate integrity in the system, and that it balances all of the compliance and policy [elements].”

Legislation

Throughout the parliamentary process, CPA Australia engages in consultation on exposure drafts, bills and Parliamentary Committee inquiries. This requires detailed analysis of the legislation and accompanying documents, and consideration of practical impacts such as potential gaps or unintended consequences. The expertise of our members is essential in identifying issues and proposing solutions or alternatives.

Administration

When applying the law, CPA Australia represents its members on a range of committees, working groups and forums to support efficient and effective administration. Important issues can often arise, especially with large-scale transformation or complex changes to the law, and members’ input is critical to escalating systemic issues or highlighting problems in practice.

In Australia, CPA Australia works with government bodies, including the Australian Taxation Office (ATO), the Tax Practitioners Board (TPB), the Inspector General of Taxation and Taxation Ombudsman and the Australian Small Business and Family Enterprise Ombudsman, to prioritise and resolve systemic administrative and interpretive issues, as well as identify opportunities for improvements.

In the webinar, ATO Deputy Chief Tax Counsel Andrew Orme acknowledges, “the profession is often the first to see and surface the issue with the ATO, and a lot of what is achieved is through the early intelligence”.

“Getting the feedback from [practitioners] is really influential on us. It flows into understanding the issues and how to make improvements,” he continues.

Operations

Given the complexity of tax systems in many regions of the world, the operational environment can give rise to myriad challenges and complaints.

Administrative processes, digital interfaces and regulator engagement all require ongoing oversight to ensure taxpayers and their professional advisers are treated lawfully, equitably and with transparency. CPA Australia and its members meet regularly with the ATO and TPB to discuss operational matters and develop joint strategies to resolve problems and enhance communication with practitioners and taxpayers.

The value of CPA Australia

In partnering with other professionals, administrators and policymakers, CPA Australia provides perspectives from the profession, as well as the clients it supports.

This collective expertise of our members provides insights into the tax system in operation, and supports the development of a coherent approach across the various elements.

Our post-COVID-19 pandemic economic recovery policy bulletin notes:

• Tax reforms should seek to encourage business investment and economic growth, as well as support consumer spending in order to restore GDP growth, and
• The government should focus on expenditure and seek efficiencies and productivity gains within its operations, rather than increasing the tax burden.

Former CPA Australia president, Dr John Miller AO FCPA, says, “There’s hard work ahead as ultimately we become the nation into which our tax system shapes us. Reform requires a comparative evaluation of the facts, taking into account Australia’s relative global tax competitiveness, access to debt and fiscal position. With vision and courage, we can change for the public good.”