MINUTES
19th meeting of the CFE Professional Affairs Committee
Thursday 18 September 2014 in Amsterdam
Chairman Dick Barmentlo
Delegates
AT Friedrich Rödler
BE Christine Cloquet
CZ Radek Neužil
DE Axel Pestke, René Bittner
IE Martin Lambe (replacing Cora O´Brien)
IT Piergiorgio Valente
MT Jonathan Abela
NL Wim Gohres, Wil Vennix
PL Dariusz Malinowski
SK Branislav Kovač
SI Aleš Budja
ES Stella Raventós (replacing Marta Gonzalez)
CH Walo Stählin
UK Heather Brehcist, John Roberts
Guests Dirk ten Brink (Wolters Kluwer),
CFE, MOs Jiří Nekovář (CFE), Martin Tuček (CZ), Ian Young (UK), Anthony Thomas (UK), Gary Ashford (UK), Ian Hayes (UK), Paul Cramer (NL)
CFE staff Uta Gayer, Rudolf Reibel
1. Chairman´s welcome
Chairman Dick Barmentlo opened the meeting, welcoming the members.
He mentioned the letter sent to CFE member organisations on 17 March 2014, repeating CFE´s offer to assist member organisations in the organisation of conferences with an international dimension, in particular in the area or BEPS.
The CFE applied to the European Commission´s “Expert group on automatic exchange of financial account information”, nominating himself and Gary Ashford [CFE was informed in 1 October 2014 that it has not been accepted. The composition and timetable of the group were still unknown by 19 February 2015].
Dick mentioned that the chair of the PAC for 2015 and 2016 would be appointed on the following day by the General Assembly and the PAC could nominate a candidate. He asked for any interested members to step forward. There were no expressions of interest. Dick expressed his availability for a second term.
Rudolf Reibel presented a flyer produced on the basis of the “European Tax Advisers´ Priorities 2014-2019” and sent to key contacts in the new European Parliament.
The minutes of the 18th meeting on 26 March 2014 in Brussels were approved.
2. National Reports
National Reports were received from Belgium, the Czech Republic, Ireland, Malta, Poland and the UK and published on 1 October 2014.
Briefly mentioned were changes in the UK (retrospective anti-avoidance legislation has been introduced in March, looking back several years; house raids are being conducted for normal tax investigations). Tax evasion, although a criminal offence, can now be penalised without dishonesty check, like a traffic offence. There are conduct notices of HMRC on professionals that are found to be promoters of avoidance schemes.
Radek Neužil mentioned new Czech legislation that already criminalises the preparation of tax evasion, allowing interpretations that assume such activities at an extremely early stage, which causes great uncertainty. There is no established practice yet.
Wim Gohres reported that the Dutch Ministry of Finance has asked the accounting profession to come forward with a serious move towards tax honesty, in reaction to a scandal involving illicit behaviour by accountants of a Big 4 firm. The accountants´ approach is to do more than is required by law, including “fair share” considerations, causing worries that this could also be expected from the tax profession.
Piergiorgio Valente mentioned the difficulty to convince tax authorities that a scheme has not been suggested by the tax adviser, if the client says so. According to planned legislation in Italy, companies will have to prove a valid economic reason.
3. Platform for Tax Good Governance / FC/PAC Joint Working Group
Piergiorgio gave a brief summary of the Platform meeting of 10 June 2014. The CFE is contributing to the work of the Platform by providing answers to a questionnaire on tax havens, extended by Piergiorgio.
CFE gave a presentation on the permanent arbitration tribunal to the Platform members. Friedrich Rödler stresses the importance of a binding dispute resolution mechanism but expressed doubts as to whether a private arbitration panel will find acceptance among tax administrations. There could also be a separate section within the CJEU dealing with this.
4. OECD consultation on voluntary disclosure
Rudolf explained the background of the OECD public consultation on voluntary disclosure and the draft CFE Opinion Statement in which suggestions both from the Fiscal Committee and the PAC have been included. The Committee members from Austria, Belgium and the UK reported on their countries´ successful voluntary disclosure programmes.
5. Model Taxpayer Charter and EU Taxpayer´s Code
Ian Hayes reported from discussions he had with the other authors of the Taxpayer Charter publication saying that apart from a Charter in “Ten Commandments” style, there could be a separate document on the role of tax advisers.
Dick supported a list of rights and obligations in “Ten Commandments” style. Axel Pestke mentioned that charters which are not part of the law do not have real significance in some continental law countries, such as Germany. Ian Young mentioned the UK´s experience with “Your Charter” introduced in 2009, saying charters give citizens awareness of their rights and confidence when dealing with the authorities.
It was said that tax advisers or intermediaries would not have to be included in the Taxpayer Charter just because this had been suggested in Pascal Saint-Amans´ (OECD) letter and that the role of tax advisers should be mentioned only to the extent that they protect taxpayers´ rights, i.e. the aspect of privilege.
The two examples from the US (IRS Taxpayer Bill of Rights) and Australia (Tax payers rights and obligations) were discussed. It was said that they can serve as good examples, pointing in the right direction, but the CFE´s list should be more outspoken. It was remarked that the Charter should oblige the tax administration to put equal efforts into finding information against and in favour of the taxpayer.
Dick Barmentlo announced that CFE would come forward with a draft list of rights and obligations. He asked for comments from the Committee on the wording of the draft letter to Pascal Saint-Amans. No comments were received. [The letter was sent on 6 October 2014.]
6. Guest speaker Dirk ten Brink, Wolters Kluwer Netherlands: “The Tax Practice in the Future”
Dirk ten Brink gave a presentation of possibilities for real-time interaction between tax adviser and client involving mobile information technology. Service providers not having a tax adviser qualification but using mobile technology might start offering services traditionally provided by tax advisers. Clients will increasingly expect real-time solutions from their tax advisers, being used to obtaining such solutions for other services. Tax advisers should therefore embrace mobile IT technology for their communication with clients.
He admitted that the solution presented is not yet ready to be used. Another challenge may be to change the client´s behaviour pattern, i.e. to scan documents instead of handing over an unsorted pile of papers. It was suggested that spreadsheets could be developed in which information from scanned documents would automatically be entered.
Dick explained the purpose of the planned survey on “The tax practice in the future”. He explained that this would require CFE member organisations to ask their individual members to respond to a questionnaire on software and IT technology solutions used by tax advisers and tax advisers´ expectations on the future of their practice and the tax profession in general. A draft questionnaire had been circulated to the PAC members. It is envisaged that this survey is carried out in collaboration with Wolters Kluwer and that there would be a benefit for CFE from this.
There was a discussion on the proposed questionnaire to which Committee members suggested a number of changes. CFE agreed to include these in the draft. CFE will figure out with Wolters Kluwer legal and technical aspects of the cooperation and report back to the Committee, with the final questionnaire.
7. 7th PAC Conference in November/December 2014
Dick and Rudolf gave an update on the preparations for the PAC Conference on 5 December 2014 in Paris and explained the topic and programme.
8. 4th Anti-Money Laundering Directive proposal
Rudolf reported on progress on the revision of the AML Directive. It is positive that the compromise text proposed by the Council has not taken aboard the references to tax avoidance and aggressive tax planning proposed by a number of MEPs. The text still contains the introduction of registers on beneficial ownership. He explained that a memo on the main changes had been sent to the AML working group which has not reacted in favour of producing another, third Opinion Statement on the proposal. The Committee member agreed to that.
[A final compromise text was agreed between the Council, Commission and Parliament on 16 December 2014. It was endorsed by the EU Council on 10 February 2015.]
9. Items for report
a) Access to insurance for services provided in another member state
Dick and Rudolf gave a brief update on meeting with the European Commission DG MARKT in May 2014. The Commission is seeking to improve availability of professional indemnity insurance for cross-border services. There has been a working document of 31 March 2014 on this issue. The Commission is also consulting with the professions of lawyers and architects and is favouring a practical solution over legislation or infringement proceedings. After having consulted the PAC members, CFE had informed the Commission in June 2014 that the practical relevance of the problem for tax advisers is very low.
b) Professional qualification, ownership requirements and fees: Commission Communication and Staff Working Paper of 2 October 2013
Axel mentioned that DStV will be invited to a discussion in the German Ministry of Economy which coordinates the work.
c) Court decisions
Rudolf briefly mentioned the EU Court of Justice´s decision on the recognition of a professional qualification obtained in another member state only weeks before the application for recognition, which the CJEU did not see as a circumvention of the Directive, cases C-58 and 59/13, Torresi (17 July 2014).
10. Nomination of a PAC Chairman for 2015-2016
The Committee members nominated Dick Barmentlo as Chairman for the PAC for 2015 and 2016. There were no other candidates. Dick thanked the members of the Committee.
[He was appointed by the General Assembly on 19 September 2014.]
11. Any other business
No other matters.