PwC scandal: Details of sector crackdown laid out
The Albanese government has released draft legislation to impose penalties of up to $780 million for tax promoter breaches as part of its response to the PwC tax leaks scandal.
The four sets of legislation include the new promoter penalties, changes to Tax Office secrecy and wider powers for the Tax Practitioners Board, in the first stage of what the government has described as the biggest crackdown on tax advisers in Australian history.
Treasurer Jim Chalmers: “The PwC scandal exposed severe shortcomings in our regulatory frameworks.” Alex Ellinghausen
The legislation comes four months after The Australian Financial Review published emails that exposed how PwC used leaked Treasury information to market tax schemes.
The government hopes to put the legislation to parliament by the end of the year.
But more contentious issues flagged by the government last month as part of its review face slower going. Industry consultations were to begin “in coming months”, Treasurer Jim Chalmers’ office said in a statement.
These include changes to legal professional privilege, more information-gathering powers for the ATO and new governance rules for big four accounting firms, which have brought industry pushback.
Separately, a joint parliamentary inquiry will examine the partnership models of the big four consulting firms, their disclosure obligations, and explore how regulators and the government can impose penalties on their personnel for bad behaviour.
“The PwC scandal exposed severe shortcomings in our regulatory frameworks that were largely ignored by the Coalition, and we continue to take significant steps to clean up the mess,” the statement said.
“The reforms we’re progressing today are the beginning of a comprehensive process
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