The Financial Services Council has called for the current regulatory regime for advisers providing both tax and financial advice to be made simpler by removing overlapping and duplicated registration.
The FSC made the submission last week to an independent review of the Tax Practitioner’s Board and Tax Agents Service Act 2009.
It said the reform would bring tax financial advisers (TFAs) into a single regulatory regime under the Financial Adviser Standards Ethics Authority (FASEA), and reduce unnecessary costs and bringing greater clarity to consumers and advisers.
Further, the FSC said advisers would continue to be bound by other regulations including privacy and anti-money laundering laws.
FSC chief executive Sally Loane said the industry body’s preferred approach would mean advisers adhere to one code of ethics, and are overseen by one code monitoring body that helps deliver the protections consumers expect and that advisers are obliged to adhere to.
“Ongoing changes to the regulatory environment for financial advisers, including new professional and education standards are transforming financial advisers into a profession in line with other professions such as accounting and law,” Ms Loane said.
“These changes present a timely opportunity to integrate tax (financial) advisers (TFAs) into the regulatory framework for financial advisers.”
Ms Loane said its approach would not mean a decline in the standards for TFAs, and would mirror the approach for lawyers who do not need to register with the TPB given their existing strong regulatory structures.
“The FSC’s recommended approach means consumers would not have to engage with the TPB for the tax component of the advice they receive as well as the Code Monitoring Body for financial advice,” she said.
“Ensuring a simplified regulatory regime that reduces regulatory overlap and is easier for customers to navigate is thoroughly consistent with the recommendations of the Hayne royal commission.”
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