The regulation of tax advisers was at the heart of discussions, on Monday 25 April, at a public hearing in the European Parliament’ Subcommittee on Tax Matters (FISC).
The experts who participated stressed the role that should be played by the correct implementation of already existing legislation, with some saying that this was more important than agreeing on new rules. Others, on the other hand, argued that the priority was to tackle the continued existence of politically stable tax havens such as Luxembourg or Switzerland, which provide a favourable environment for the activities of unscrupulous tax advisors.
Better training of future tax advisors, including a more in-depth course on ethics, was suggested as well as part of the solution.
Participants also said that increased media scrutiny and the resulting reputational risk of unethical tax decisions also contribute to the fight against these practices. According to Emer Mulligan, Professor of Taxation and Finance at the National University of Ireland, Galway, “some tax advisers perceive that additional regulation is unfair, that, fundamentally, some are paying for sins of others”.
Finally, regulatory and cultural differences in the different Member States were highlighted as an issue that should be addressed by any future European regulation.
During the hearing, the representative of the European Commission announced that a legislative proposal to regulate tax advisers is being prepared, with a public consultation scheduled for May.
MEPs asked how new technologies could be used to help with tax compliance. Grant Wardell-Johnson, Global Tax Policy Leader at KPMG and Chair of the Global Tax Policy Leadership Group, said the OECD’s work is a step in the right direction, but there is still a need to “strike a balance” on what information should be required at the reporting level.
They also asked for concrete examples of how university courses should be redesigned. Aleksandar Ivanovski, Director of Tax Policy at CFE Tax Advisers Europe, noted that “not everything can be solved with tax administration”. He said that “tax students are not exposed to ethics during their law curricula, because tax is not only crunching the numbers, it is also politics, it is our society”.
Finally, members of the FISC Subcommittee wanted to know whether professional disciplinary measures should be introduced and how to better address problems arising in the grey area, i.e. activities that may not be illegal, but would be considered unethical. (Original version in French by Anne Damiani)