Treasury reviews Tax Practitioners Board positions after PwC scandal
Treasury is advertising the positions of the chairman and half the members of the Tax Practitioners Board (TPB) in the aftermath of the PwC leaks scandal that was uncovered by the board.
The positions will be advertised in The Australian Financial Review and other media from Friday, with existing members able to reapply for the positions as their terms expire.
Outgoing Tax Practitioners Board chairman Ian Klug. Michelle Smith
Seven of the board’s eight members were appointed or reappointed by former assistant treasurer Michael Sukkar, who worked for PwC in 2005-2006.
Mr Sukkar’s appointments included two former PwC partners, Judy Sullivan and Peter Hogan, and former KPMG tax partner Peter de Cure.
Sullivan and de Cure’s terms expire in October, along with former BDO Hobart managing partner Craig Stephens. Mr Hogan’s term expires in August 2024.
Separately, the chief executive of the Board of Taxation, PwC partner Christina Sahyoun, returned to the big four firm in January after completing her 18-month secondment with Treasury.
In December, the TPB, which oversees Australia’s 80,000-odd tax agents, deregistered PwC’s former head of international tax, Peter Collins, for two years after finding he leaked secret government tax policy in 2014 that was shared with as many as 30 PwC partners and staff, despite signing a series of confidentiality agreements with Treasury and the Board of Taxation.
The finding by the board conduct committee of the TPB also required PwC to hold regular training courses to help PwC staff recognise conflicts of interest.
TPB chairman Ian Klug was already due to leave with his term expiring last month. He had extended his term for 12 months last year. He has been on the TPB since 2015 and was appointed chairman by then-treasurer Josh Frydenberg in 2019.
Mr Klug has issued a clarification to answers he provided to a Senate committee last month about the former PwC partners on the board, Mr Hogan and Ms Sullivan.
In the statement, Mr Klug said both former partners received ongoing payments from PwC as part of the firm’s retirement program, after having initially said he did not believe they were remunerated by the big four firm.
He also said that the pair “recused themselves from any relevant matters …including issues related to our investigation of PwC and Mr Peter Collins”.
PwC pays eligible former partners an average $140,000 a year from the firm’s annual profits, in some cases for life, under the partnership agreement.
There is no indication that any TPB or Board of Taxation members were aware of the leaks.
This is the second board review involving Mr Hogan. Last October Treasury called for applications to replace the advisory board of the Australian Charities and Non-profits Commission (ACNC). Gary Johns, a controversial pick by Mr Sukkar as commissioner in December 2017, resigned in June weeks after Labor won power.
Mr Sukkar’s 2017 decision to appoint Mr Hogan, the chairman of coal seam gas company Carbon Energy, to the ACNC advisory board was also controversial at a time when the government was keen to discourage political protests by climate groups.
Mr Sukkar’s preference for PwC alumni was reflected at the Board of Taxation where in addition to Ms Sahyoun the seven non-government board members included former PwC veteran Anthony Klein and PwC Special Counsel Chris Vanderkley, while barrister Dr Julianne Jacques, KC, formerly worked at Coopers & Lybrand (now PwC).
A fourth board member, Ian Kellock, is a tax partner at law firm Ashurst, where Mr Sukkar worked for seven years to 2013.
Two of the five board members of the Australian Reinsurance Pool Corporation, which provides $14.7 billion on reinsurance cover for terrorism and cyclone damage, are former PwC partners including chairman Ian Carson.
Mr Sukkar was not immediately available for comment.
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