Professional Services Editor
AUDITORS and lawyers who give tax advice would not be subject to the disciplinary procedures of a new independent regulatory board for tax practitioners to be established under new tax laws.
“However, such tax advisers will still be required to register under the revised Draft Regulation Tax Practitioners Bill,” said South African Revenue Service (SARS) legislative policy GM Franz Tomasek yesterday.
Following a lengthy consultative process with tax practitioners and other stakeholders in which SARS had considered comments, the revised bill was released yesterday for comment.
Nearly 23000 tax practitioners are registered with SARS.
As far back as 2002, Finance Minister Trevor Manuel indicated that tax practitioners would be regulated. There are no overall requirements, such as a code of conduct, that stop people from being tax practitioners.
The purpose of the legislation is to promote better compliance and ensure that taxpayers receive advice which is consistent with SA’s tax laws.
There were too many unscrupulous practitioners who were prejudicing taxpayers and had given the accounting and legal profession a bad name.
As a preliminary step, tax practitioners had to register with SARS in 2005. This phase provided information on existing advisers with regard to their qualifications, experience and membership of existing bodies, such as the South African Institute of Chartered Accountants, and the Law Society of SA.
Last year SARS released the draft Regulation of Tax Practitioners Bill. Comments from stakeholders were taken into account and the bill had since been refined and revised.
Tax practitioners were up in arms last year over a provision contained in the draft bill for tax advisers who uncover fraud and other tax irregularities related to their clients to report them to the regulatory board.
The concept enjoys a precedent in the Auditing Profession Act which provides for similar obligations. Tomasek said the concept of a reportable irregularity would not be pursued in the revised bill.
The revised bill creates an independent regulatory board for tax practitioners which ensures that the professional ethics of advisers are maintained, and will institute disciplinary proceedings against practitioners who do not comply with standards set by the board.
The board will also prescribe standards for qualification.