Shadow assistant treasurer Andrew Leigh has announced that a Labor government would channel $4 million to fund 10 free tax clinics to provide assistance for vulnerable taxpayers.
“While multinationals and millionaires can afford an armada of experts to navigate the tax system, low and middle-income Australians are often intimidated by the tax system, and unsure where to turn to get help,” said Dr Leigh.
“Each tax clinic will have volunteers, students and pro bono tax practitioners on hand to help low income taxpayers and micro businesses with administrative tax matters, including completing tax returns and responding to queries raised by the Tax Office.
“Tax clinics can help people avoid accidental mistakes, or navigate complex forms, just as tax accountants do for more affluent taxpayers.”
The tax clinics will also seek to help taxpayers with disputes they may have with the Tax Office.
Dr Leigh said the proposal was raised by former Inspector General of Taxation Ali Noroozi who noted that tax clinics would be one potential avenue for assisting disadvantaged taxpayers.
Curtin University has been trailing the clinic since 1 July this year, with Labor keen to continue funding the trial in 2019 before expanding the concept to 10 universities across Australia from 1 January 2020.
The proposal will see Labor legislate a carve-out in tax practitioner law to allow for the tax clinics to register as tax agents in their own right – much like a body corporate.
The 10 tax clinics will also be provided deductible gift recipient status to facilitate partnerships with experienced tax professionals and institutions.
Speaking to Accountants Daily, CPA Australia head of policy Paul Drum said the proposal was a continuum of a number of measures already in place in the industry, including the ATO’s Tax Help program, which assists taxpayers in lodging tax returns.
“Many members of the accounting and legal professions already provide pro-bono services from time to time and what’s proposed offers a new framework under which this assistance could also be provided to those who most need it but have limited means,” said Mr Drum.
“The ATO already has Tax Help which helps you fill up myTax but this is a broader proposal to assist with other ATO enquiries. Dr Leigh talks about ATO disputes which is much broader than just a simple ATO enquiry.
“It’s dealing with correspondence and letters from the ATO – some of it might be about financial and tax literacy – it could be very basic. There’s not enough to tell us at this stage precisely what the parameters will be but certainly we get a sense of where they are pitching the proposal and that is the lower end of the market – the simple, uncomplicated affairs.”