03 Dec 1010 Preamble - Friday 3 December 2010This week the Government released the long-awaited discussion paper on the way forward post June 2011 for the ‘Regulation of Tax Agent Services Provided by Financial Planners'. The Taxation Institute issued a media release on the same day: "Financial planner options paper points way to better consumer protection".
The Federal Government has an opportunity to close a loophole and ramp up consumer protection with the release of the paper. It provides two options for extending regulation of financial planners giving tax advice. One involves rolling financial planners into the Tax Agent Services Regime; the other investigating and implementing what changes, if any, might be made to the Financial Services Licence system.
The paper confirms that doing nothing is not an option. As the Taxation Institute has long been advocating on behalf of members, people relying on tax advice should expect that their adviser meets the highest standards that the Tax Agent Services Regime offers, and that they are also covered by the sorts of protective measures contained within it.
The Government has asked for comments on the discussion paper by 25 December - all that consumers want for Christmas is certainty and protection from misguided and misleading tax advice.
The need for change to the way some financial planners work has been driven home by the spectacular Storm Financial collapse that left thousands of ordinary consumers facing ruin. The risk to consumers of inaction far outweighs the minimal compliance involved in bringing financial planners under the consumer protection regime for tax advice. If it's good enough for professionals like accountants and agents giving taxation advice to be under more scrutiny, it's good enough for financial planners.
Please see below for details of other activities this week.
Robert Jeremenko FTIA