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CIOT and ICAEW support mandatory professional body membership

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The CIOT response to HMRC’s consultation on raising standards in the tax advice market examines the three options for regulation rather than looking at the merits of regulation versus alternative approaches. Key points include:

  • general support for mandatory professional body membership, as the system which could be set up in the least amount of time and at the lowest overall cost, subject to further details as the policy develops;
  • regulation will not necessarily address all perceived problems, and the CIOT has set out its initial thoughts, including steps to be taken by HMRC;
  • a three-year transition period will be required as a minimum to give sufficient time for the market to adapt to regulation, but that period may be too long to address certain areas of poor practice, such as poor standards in the R&D tax advice market where more urgent action is required;
  • mandatory registration for all tax practitioners would be a necessary first step, so that the population which needs to be regulated can be identified - regulation at firm level would seem to be the most appropriate model, although there are nuances that need to be considered;
  • the CIOT does not consider that other professionals (such as lawyers and IFAs) should be excluded from registration and regulation.

The CIOT has also provided further detailed comments and recommendations on various aspects of the proposed regulatory framework.

ICAEW has also commented that any change to the regulation of the provision of tax advice must be made in the public interest, saying that the chosen approach must raise technical and ethical standards among tax practitioners and protect consumers from incompetent or unscrupulous practitioners, without increasing costs to the extent that taxpayers cannot afford professional advice.

Alan Vallance, ICAEW Chief Executive, said: ‘While we think there are issues with all of the proposed options, if HMRC does decide to introduce tax regulation, our preference is for mandatory membership of a professional body but only if the model is appropriately designed and scoped. If not, there is a risk that costs could be pushed down to consumers, making tax advice and services unaffordable and therefore undermining the objective of regulation.’

Issue: 1666
Categories: News
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