Treasury Laws Amendment (Strengthening Accountability for Tax Adviser Misconduct and Other Measures) Bill 2026

Senator O'NEILL (New South Wales) (11:41): It's a pleasure to make a contribution on this very important piece of legislation. Even though it's a little esoteric and inaccessible to many, many people, this is an example of the kind of legislation that is necessary by governments that want to make sure that systems are in place to manage the quality of what's happening in our financial sector and in the economy.

This particular matter before us for consideration is the Treasury Laws Amendment (Strengthening Accountability for Tax Adviser Misconduct and Other Measures) Bill 2026. I see we've got a few people from the Australian public who are here in the parliament. Perhaps it's the first time they've been—welcome, if it's the case—and perhaps others have been before and have acquired a taste for the strange things we do here on your behalf.

A lot of what we do seems incredibly inaccessible. When I say that title, people go, 'Well, what's all that about?' I will put on the record some of the context of why this stuff actually matters. Senator Scarr, you have a role with me on the Joint Committee on Corporations and Financial Services.

I'm sure the Australian people will be very grateful for the hard effort of that unified committee, and I acknowledge also in the chamber, soon to make a contribution, my colleague from the Greens party. The Liberal and National parties, the Labor Party and the Greens party have been working in shock and horror and with a collective, values based response to making sure that our financial markets work in the interests of ordinary people.

There are bad people out there who want to take your money from you, and there are bad people out there who will act unethically and will rip off people left, right and centre. Some of them are very highly skilled. Some of them even have very highly vaunted qualifications, like the term 'accountant' or the special brand of the accountancy part of that environment which is auditors.

I'm sure that some of you here today and some who might be listening anywhere around Australia will have heard about the shameful behaviours of a couple of the big auditing companies in this country. They actually operate all around the world. It's like a franchise model, but it's not McDonald's.

They don't say, 'Would you like fries with that?' but they certainly say, 'Would you like to pay more for that?' They cost us an awful lot of money to provide the services that they need to provide. Auditors are like superspecialist doctors. You have to open your whole company.

Registered companies have to be wholly open so that people can go in and have a look and see what's going on, and they need to tell the truth. Two of the big ones are PwC and KPMG—there are another two: EY and Deloitte—but lot of the work of my colleagues here in the chamber and on our committee, which I'm honoured to chair, has focused on those two particular ones.

The reason this legislation has come about is due to the work of senators working together to flush out what was going on in these very powerful and highly resourced entities that had a veil of secrecy. In PwC's case, there was a tax leaks matter. You might have heard about it.

Essentially a very, very smart person in the tax division of PricewaterhouseCoopers, PwC Australia, was invited by the then Treasurer, Mr Hockey, to come and help create great laws so that international companies would pay their fair share of tax in Australia so the burden didn't fall just to hardworking Australian taxpayers. His name is Peter-John Collins. Instead of keeping that confidential, though he did sign a non-disclosure agreement—a secrecy document; he wasn't supposed to share that information—he took it back to PwC, promptly wrote it up and sent it to six jurisdictions around the world and said, 'Hey, guess what?

I've got a product that can make us a lot of money.' Basically, he didn't care that it was going to cost the Australian taxpayer. That's the kind of behaviour of people who act unethically, jettison their professional responsibilities, fail to acknowledge the damage that they do when they misuse the intellectual powers and the professional skills that they have and use them, in that case, against the country to hurt every Australian taxpayer.

We need to do something about these problems. The Treasurer, Mr Chalmers—I'm sure there'll be many headlines around these people and what they do, and the leaders of these parties, but the real grunt work is actually changing things like the legislation that's coming in here. The fine now for doing what Peter-John Collins of PwC did is multiplied by a factor of 100, so we're talking about hundreds of millions of dollars of fines to stop that kind of behaviour.

Today we're not talking about quite the same thing. But what we saw with that PwC matter were the limitations of the current regulatory settings for tax practitioners and the broader system in which they operate. We know that there could be dodgy people.

I mean, I'm a very law-abiding citizen, but I have to say that sometimes, if I'm in a car, I could be distracted and might be inclined to speed a little bit, so a reminder that the police might catch me is a very important thing in containing my behaviour. Who are the police for tax practitioners? How do you get to be a tax practitioner?

Well mostly, tax practitioners are accountants, but they've got some people working for them who've got a special name: unregistered preparers. You see all the ads come out, particularly around May and June as we're going into tax season, saying, 'Come and use my company, and I'll get you a lot of things back from the government.' But there are people out there who are claiming on behalf of Australians, who haven't got the skills and aren't doing the right thing and they're putting their clients in a bad situation.

There are people, even amongst those, who are getting returns and keeping money that should be going to Australians. They're doing the wrong thing. I'm sure that somewhere down the track somebody will call this 'red tape'.

But, for me this is about protecting ordinary, hardworking, decent Australians who understand that the local roads won't get better, their schools won't get funded and they won't be able to go to hospital when they need to unless they pay a fair amount of tax—a fair amount; no more, no less—and certainly not be ripped off by the person who's providing tax advice to them.

In response to the PwC matter, the government consulted on what should happen around the policing of the tax providers, the tax agents. That is an entity called the Tax Practitioners Board. We consulted about a way to enhance what's happening with the Tax Practitioners Board, and there's a sanctions framework that needs to come in from December 2023 to 2024.

Subsequently, we announced the reforms to the regime of the 2025-26 budget, as part of the enhancing tax practitioner regulation and compliance receipt measure. That very boringly named thing is part of what we're doing here today. Following the passing of these laws, you should be more confident if you go to a tax agent that what you're being told you're being offered is in accordance with the law and that there's a policeman on the beat, the Tax Practitioners Board, with the powers to really clip the kind of behaviour that is illegal and rips off ordinary Australians.

I think there are about six or seven schedules in this particular bill, but, in the first schedule, the first part of the bill—the first chapter of a book, almost, if you want to think about it in that way—is a new regulatory toolkit of skills, opportunities and surveillance mechanisms for the Tax Practitioners Board to make sure that people are doing the right thing.

The first thing is a new criminal offence for unregistered preparers so they don't do the wrong thing. We've also in this piece of legislation, after consultation with the sector, increased the maximum civil penalty amount. So, instead of it being easy for somebody to do, they need to think twice—that it could cost them some money and that they will have to pay a penalty.

There will be new civil penalty provisions for breaches of the code of professional conduct by registered practitioners, and there also will be penalties for people who create false or misleading statements, even if they're unregistered preparers. You can't have somebody who's in charge with these unregistered preparers around them say, 'It wasn't me; it was just them.' Often, unregistered preparers sit around a central person who has a higher degree of qualification.

That being said, there are other pretty creative and somewhat damaging individuals who just set themselves up and say, 'I'm a tax agent; I'm a tax preparer.' They might have the word 'agent' small on a sign that nobody might notice, but unsuspecting Australians go to unregistered preparers and pay. If you're paying for something, you should be paying for the service that you think you're paying for.

This is to clip the wings of those con artists who might be abusing the opportunity when they see your particular financial situation and take advantage of it. To deal with that, there will be the establishment of an infringement notice regime—'We've noted you've done the wrong thing, Mr Jones or Mrs Matthews or whatever'—and there's a notice regime that will follow to let people know.

There's another thing called enforceable voluntary undertakings, which is something I had no idea about before I came to the parliament. Deputy Chair Scarr and Senator Pocock, we've certainly seen a large number of enforceable undertakings put onto different companies and partnerships by another cop on the beat called ASIC. So the Tax Practitioners Board will be able to say: 'Okay, we've seen all of this.

You're doing all this stuff wrong. We are going to enforce a certain set of practices on you. We're going to be watching you more closely.

There might be fines attached. But you're going to agree that you did the wrong thing, and there will be consequences.' That's an enforceable undertaking. I guess we have to accept the fact, though, that, for whatever reason, whether it is that they are morally vacuous or, perhaps, caught in the throes of an addiction—that can be a driver of corruption, bad behaviour and exploitative behaviour—there will be contingent and interim powers to suspend registration.

People can lose their registrations completely. Another of the things I didn't know before I came to parliament was that people who are registered might have a banning period for a short period of time and can then come back. So, to make sure that there's actually a disincentive for people to do the wrong thing once caught, we have in this legislation proposed—and I hope we'll have the support of the Senate today—to extend the prohibition period for a reapplication following a termination from five years to 10 years.

They're the specific things that are being advanced in this piece of legislation before the Senate today. The reason why we think this is so important is it's going to strengthen just not just the registered practitioners but the unregistered preparers to ensure that misconduct is both identified and addressed earlier and more effectively. The measures I'm talking about here complement a broader suite of government reforms that are about strengthening integrity and accountability across the tax system and across the professional services sector.

There's a couple of other bills. An earlier reform we pushed through that has made changes to improve the powers of that tax practitioner board, that cop on the beat, is the Treasury Laws Amendment (2023 Measures No. 1) Bill. That was about those powers and about improving transparency within the profession.

This piece of legislation is also enacted alongside obligations under the Tax Agent Services (Code of Professional Conduct) Determination 2024. That is about lifting the standards of those professional practitioners and their behaviour, and it further aligns with the Treasury Laws Amendment (Tax Accountability and Fairness) Act 2024. That one expanded the ATO's ability to target promoters of tax exploitation schemes, increased penalties and referrals of misconduct to professional bodies, and strengthened whistleblower protections.

That is just schedule 1 of a bill that has to deal with matters related to tax in Australia that go to schedule 5 and maybe even to schedule 6, 7 and 8. So it's a big piece of work. In the 40 seconds that I have remaining to me, I want to draw your attention to an options paper for which consultation has just closed.

It's about the regulation of accounting, audit and consulting firms in Australia. At the beginning of my remarks I talked about how important these people are to Australia. Every person here who's a working Australian has superannuation.

Your superannuation is invested in by yourself or by others. You need to make sure the people who are telling the truth about these books do the right thing, and that is our auditors, so we're working on that as well.