Advocacy update

Advocacy update

Rankin, Geoff

CPA AUSTRALIA CEO GEOFF RANKIN FCPA REPORTS ON ACTIVITIES CARRIED OUT ON BEHALF OF MEMBERS

CPA AUSTRALIA IS COMMITTED TO BEING AT THE forefront of debate and policy formulation on Issues of relevance and concern to our members and the broader community. Climate change is just such an issue. Over the past few months I have referred to a number of submissions CPA Australia has made on the business issues emerging from climate change, including the policy recommendations made to Treasury as part of our 2008/09 Federal Budget submission. More recently we have released an information paper on emissions trading and other related policy initiatives to better inform members about the implications of climate change, and the effects that government policies and strategies may have on business and the profession. The paper is available on our website, where you will find more information about our advocacy activities.

Legal privilege concession

For many years, and most recently in our submission to the Australian Law Reform Commission in June 2007, CPA Australia has called for legal privilege concessions for accountants. In a significant win, CPA Australia is pleased to report that the commission has now proposed extending client legal privilege to tax law advice provided by accountants, when that advice is sought by the Australian Tax Office. In effect, this formalises the Tax Office’s “accountants’ concession”. The commission’s report, entitled Privilege in Perspective: Client Legal Privilege in Federal Investigations makes 45 recommendations.

Executive remuneration

The Rudd government has launched its first major business policy: a review of directors’ corporate governance responsibilities. The government has also signalled plans to pressure companies to more clearly link executive salaries to company performance. In response to this announcement I have written to Senator Nick Sherry, minister for superannuation and corporate law, highlighting findings of CPA Australia’s report examining the remuneration of directors and top executives with the use of employee stock options (ESOs), or “rights to shares” grants under Australian accounting standards and methods of valuation applied to ESOs granted. The report – Share-Based Payments: S&P/ASX200 Companies Issuing Employee Stock Options in Both 2006 and 2007- considers relevant data drawn from 54 common S&P/ASX 200 companies. I have sought an undertaking from the minister for CPA Australia to be closely engaged in this review.

Priorities for skilled migration

CPA Australia participated in consultations with Senator Chris Evans, minister for immigration and citizenship, and senior government officials to examine critical policy and program issues associated with the setting of the 2008/09 migration program. We spoke directly to the minister and departmental staff about the importance of skilled migrants having access to assistance that will enable them to settle swiftly and to find employment in their area of professional expertise. Shortly after these consultations, Senator Evans unveiled a package of migration measures designed to address Australia’s skills and labour shortages.

Attracting business to Hong Kong

A CPA Australia survey of 207 members of the Hong Kong business community found that 65 per cent of respondents supported the idea for introducing better tax incentives to attract companies to relocate regional headquarters to Hong Kong.

About 68 per cent agreed that tax exemptions on income derived from headquarters activities should be given. Using the findings of the survey, the Hong Kong China division’s tax committee has made a number of recommendations to John Tsang, Hong Kong’s financial secretary.

These recommendations include corporate tax rates, double tax treaties with key trading nations, and development of a bilateral “green border policy” that enforces a polluter-pays policy (air, water and waste), which rewards companies that use environmental protection practices (recycling, renewable energy) through tax incentives. Another recommendation includes revisiting the merits of introducing a GST for luxury goods for a decision by 2010.

Copyright CPA Australia Apr 2008

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