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2.  Presentation to the Standing Committee on Finance – Parliament  23 October 2012 2

3.  The South African Institute of Professional Accountants welcomes the amendment to the regulation of the tax practitioners as it would assist in ensuring that there is control and accountability of the practitioners. 3

4.  The CPD requirements must be relevant to tax 4

5.  If the tax practitioners are disciplined through professional bodies disciplinary process than how do we only discipline him for tax and not the other accounting aspects of his work; For example if he is suspended from being a tax practitioner, does his membership with the professional body and accounting officer status also fall away 5

6.  Section 240A (3) - Will the minister appoint retired judges to decide on behalf of the professional body or will the tax practitioner be disciplined through the professional body’s disciplinary process. This section is ambiguous and opened to variations of interpretations 6

7.  The responsibility of submitting taxes is now shifting from the taxpayer to the tax practitioner 7

8.  You must be registered as a tax practitioner to give tax advice, but there is no control system in place to check if only tax practitioners are providing tax advice 8

9.  The bill is not clear about the transitional measurements particularly regarding a person who is not a member of a recognised controlling body 9

10.  Considering that an estimated 55% of current registered tax practitioners are not associated with a professional body, a transitional period should be provided to allow for these tax practitioners to register with a ‘recognised controlling body’, and to allow for the recognised controlling bodies to develop and implement a technician level membership as SAIPA and other provisional bodies have a significant qualification and experience entry level to membership. 10

11.  With regards to regulation of tax practitioners and the registration requirements, it’s a criminal offence in terms of section 234(c) when a person fails or neglects to register as a tax practitioner as required under section 240, after the draft amendments, to register with a ‘recognised controlling body’ and SARS as a tax practitioner in the prescribed manner and form as the Commissioner may determine, within 21 business days after the date on which that person for the first time provides advice or completes or assists in completing the return.  11

12.  However, the amended section 240 and section 234 criminal offences provisions do not require the person to remain registered with both the ‘recognised controlling body’ and SARS. So, is it only a criminal offence if the tax practitioner is not initially registered. After initial registration, the person can continue as a tax practitioner even if they are no longer with the recognised controlling body. 12

13.  Also, the provisions of 240 fails to provide for de- registration, suspension, or removal from the register, nor provides authority for the re- registration or implementation of the amended section 240. 13

14.  The new section 240A prescribes that a ‘recognised controlling body’ must have relevant and effective minimum qualification and experience requirements, continuing professional education requirements, codes of ethics and conduct, and disciplinary code and procedures. However, a more detailed criteria is required to evaluate qualifications and recognition of controlling body, implement and consistently enforce. 14

15.  It is also recommended that once the criteria has been established, recognised controlling bodies be Gazetted and publicly published on the SARS websites. 15

16.  Finally, it should be noted that similar requirements with regards training and CPD has not been prescribed with regards to SARS officials. 16

17. Thank you 17