Colin and Tax Practitioners Board
[2024] AATA 2151
•28 June 2024
Colin and Tax Practitioners Board [2024] AATA 2151 (28 June 2024)
Division:TAXATION AND COMMERCIAL DIVISION
File Number(s): 2024/1283
Re: Philippe Colin
APPLICANT
AndTax Practitioners Board
RESPONDENT
DECISION
Tribunal:Senior Member Benk
Date:28 June 2024
Place:Sydney
The application for a stay is refused.
................[SGD].............................................
Senior Member Benk
CATCHWORDS
PRACTICE AND PROCEDURE – STAY APPLICATION – tax agents’ registration – false and misleading statements – underreported income – failure to lodge returns and business activity statements prospects of success – public interest – hardship – early hearing – dissolution of interim stay
LEGISLATION
Administrative Appeals Tribunal Act 1975 (Cth), ss 2A, 40, 41(2), 41(3), 41(5), 42A(2)
Tax Agent Services Act 2009 (Cth), ss 2.5(1), 2.5(2), 3(1), 30-1, 30-10, 30-10(1), 30-10(2), 30-10(7), 30-10(11), 30-10(14)
CASES
Scott v Australian Securities and Investment Commission [2009] AATA 798
Australian Securities and Investments Commission v PTLZ [2008] FCAFC 164
Oaklands and Australian Securities and Investments Commission [2011] AATA 199
Poidevin and Australian Securities and Investments Commission [2018] AATA 124Evans and Tax Practitioners Board [2019] AATA 1408
REASONS FOR DECISION
Senior Member Benk
28 June 2024
BACKGROUND
In a decision dated 25 January 2024, the Tax Practitioners Board (the Respondent) cancelled Mr Philippe Colin’s (the Applicant) registration as a taxation agent and imposed a four-year ban on the provision of services in that guise. This decision was made following an investigation in which the Respondent concluded the Applicant had engaged in:
(a)unauthorised amendments to the income tax returns (returns) of four clients and one former client;
(b)a failure to pay his taxation debts when they fell due;
(c)failed to correctly report amounts in his own returns and business activity statements;
(d)allowed his company to advertise that it can provide tax agent services when it is not a registered tax agent with the Respondent; and
(e)demonstrated an ongoing failure to comply with orders of the Tax Practitioners Board to complete and pass a course in ethics.
The Respondent maintained the above breaches (which to date have not been disputed with any vigour by the Applicant, (except to say that he has not engaged in fraud and that he has not done much wrong[1]) contravened the Tax Agents Services Act 2009 (Cth) (the Act). The Applicant was notified of the decision in writing and informed of his review rights.
[1] Request for Stay order dated 24 April 2024 completed by the Applicant.
Procedural history within the Tribunal
The Applicant then sought review of that decision by the Administrative Appeals Tribunal (the Tribunal) and requested a stay, to which the Respondent consented. This resulted in the initiation of a timetabled case management strategy.
The case history shows the Applicant has been given much guidance and direction about his obligations to the Tribunal. Case conferences were arranged along with Directions hearings with mixed degrees of participation by the Applicant. Accessibility was also catered for with the Applicant being offered both telephone and video platforms within which to present his case.
The Applicant largely ignored timetabled directions and failed to provide adequate medical evidence to demonstrate that he had no legal capacity to deal with these proceedings, despite making such claims.
The parties were advised in writing that the application for a stay was to be listed at 9.30am on 18 June 2024.
On 14 June 2024, the Applicant forwarded to the Registry a medical certificate by Dr Christopher Dowling stating he was suffering a medical condition and was unable to undertake work related duties until the 21st of July 2024 and requested an adjournment of the proceedings.
The Registry informed the Applicant that the medical certification was insufficient to warrant adjournment and again confirmed the hearing date and time in writing.
On 17 June 2024, the Applicant forwarded a further medical certificate again by Dr Dowling stating the Applicant had in fact been hospitalised between 2 May 2024 to 31 May 2024 and that “from my understanding, I feel it could be detrimental to his ongoing recovery to attend the State Hearing on the 18/6/2004. I advise he refrain from work related activity until the 21 July 2024.”
Again, in response and on the same day the Registry notified all parties that the hearing would proceed as scheduled.
At the time of the scheduled hearing, the Applicant did not appear. The Respondent was present and indicated it was instructed to proceed and oppose the stay. The Respondent submitted if I was mindful to dismiss the application for want of appearance, [2] it would make an application to revoke the earlier consent stay to ensure that no ambiguity existed as to its operation and effect .[3] The Respondent further submitted that these were not optimal outcomes given that the Applicant has been afforded ‘reasonable opportunity’ to make submissions.
[2] Section 42A(2) of the Administrative Appeals Tribunal Act 1975
[3] Section 41(3) of the Administrative Appeals Tribunal Act 1975
The Respondent submits I should give little weight to the medical certificates and provided evidence demonstrating that despite certified incapacity, the Applicant has continued to provide tax services during this period. I note that despite the medical certificate certifying that the Applicant had been hospitalised until 31 May 2024, the records show that the Applicant lodged taxation returns on 29 May 2024[4] and further taxation returns and BAS statements on 31 May 2024.[5] The records then show that the Applicant has continued to work and lodge returns.[6]
[4] Folio 2057 of the supplementary T docs
[5] Folio 2124 of the supplementary T docs
[6] Folio 2222 of the supplementary T docs
The Applicant made several requests for adjournment including on 6 and 12 June but provided no cogent reason for those applications. As discussed above, the Tribunal received further requests to adjourn/vacate proceedings on 14 June 2024 and 17 June 2024. In response to this request by the Applicant, the Respondent filed additional supplementary documents confirming the Applicant had engaged in work (contrary to the certification) and had lodged taxation returns between 14 June and on 17 June 2024.
The above leads me to form the view that the Applicant is being far from candid in relation to his medical capacity and ability to participate in a hearing and frankly I have doubt regarding his credibility. However, as the Applicant has failed to appear and so has not allowed me the opportunity to explore this further, I propose to follow the advice proffered by the majority in Fox -v- Percy [2003] HCA 3 at paragraph 31, that is, rather than placing undue emphasis on resolving issues of credit, it is preferable for decision makers to “reason their conclusions as far as possible, on the basis of contemporary materials, objective established facts and the logic of events”.
To make the complex simple, the Applicant has failed to appear at the hearing maintaining he is medically incapacitated. I do not accept the medical evidence as being sufficient to establish incapacity given the contemporary materials which demonstrate the Applicant has been actively working, entirely inconsistent with the certification. If the Applicant is fit to manage the complex task of undertaking taxation assessments including taking instructions from clients and ensuing that both his client’s and his obligations are met in line with the regulations, presumably in response to deadlines, I find that he would more likely than not be able to participate in a hearing, or at least have the courtesy to make an appearance and justify his request for adjournment, given that he was informed in writing that the matter was to proceed.
So, what happens next? In the ordinary course of events, the Act permits me to dismiss the application for want of appearance. However, the Respondent submits the interests of justice would not be served by dismissing the application because:
(i)the proceedings were initiated by the Applicant;
(ii)the Applicant has been given a reasonable opportunity to present his case;
(iii)the certificates of incapacity are inconsistent with demonstrated capacity and appear to be self-serving with the likely aim to secure delay particularly given that an interim stay is on foot; and
(iv)there is powerful evidence, even on the face of the documents, that the Applicant’s conduct would demonstrate that a stay is not appropriate.
Overall, I find the Respondent’s submissions persuasive. Further, I also carry the burden of the objectives of the Tribunal, in that I must provide and promote a review mechanism that is accessible, just, fair, economical, informal, and quick which also promotes public trust and confidence in the decision making of the Tribunal.[7]
[7] Section 2A of the Administrative Appeals Tribunal Act 1975
As discussed above, the Applicant initiated these proceedings. A timetabled case management strategy was implemented, and he was given much assistance to prosecute his request for a stay. His medical evidence has not been ignored; however, I find it has been invalidated by his conduct and so carries no weight. On reflection I find that dismissal of the application outright would have little utility as it would only disadvantage the Applicant as it is likely to delay a final review of his matter. For these reasons, I proceeded to consider the stay application taking into account both the oral and documentary evidence. I further note that I am permitted to proceed in the absence of the Applicant where I am satisfied that he has had reasonable notice of the proceedings.[8]The Applicant has been given a reasonable opportunity to respond.[9]
[8] Section 40 of the Administrative Appeals Tribunal Act 1975
[9] Section 41(2), (3) and (5) of the Administrative Appeals Tribunal Act 1975.
On review of the documentary evidence and oral submissions before me, I have decided it is not desirable to make orders under s 41(2) of the AAT Act which would allow for the decision by the Respondent to be stayed. That means the interim stay is dissolved and the reviewable decision takes effect according to its terms. My reasons follow.
THE REGULATORY CONTEXT
It is helpful to understand the regulatory context in this case and how the decision came to be made. The Respondent maintains the Applicant’s breach of the Act is so significant and its grounds so powerful that the application for stay must be dismissed.
Sub-section 2.5(1) of the Act defines its objects as to ‘support public trust and confidence in the integrity of the tax profession and of the tax system by ensuring that tax agent services are provided to the community in accordance with appropriate standards of professional and ethical conduct’. Sub-section 2.5(2) of the Act provides that the object in ss 3(1) is to be achieved, amongst other things, through providing for a system of registration and regulation of tax agents, a Code of Professional Conduct (Code) and a system of sanctions and discipline of tax agents.
Sub-section 30-10 of the Act provides for the Code which includes a series of mandatory obligations with which tax agents are expected to comply. It is unsurprising that the very first obligation in s 30-10(1) is that a tax agent ‘must act with honesty and integrity’. Underlying those obligations is the fact that to obtain and maintain registration under the Act, the Board must be satisfied that the person is a fit and proper person to be registered.
A breach of the Code or a failure to conform to the requirements of registration renders a tax agent liable to termination of registration.[10] For breaches of the Code, there are other lesser sanctions that may apply such as cautions, suspensions, orders to complete prescribed training and so on.[11] The history shows that the Applicant is no stranger to these sanctions.
[10] TA Act Part 4A.
[11] Sections 30-1 of the Act
The consequence of the above is that the Act has its focus on achieving the objective in ss 3(1) by restricting those acting as tax agents to fit and proper people and requiring them to conform to various prescribed standards of professional behaviour. In simple terms, and by way of example only, a failure to act honestly or with integrity does not encourage public trust and confidence in the tax profession, such that, a failure to act with honesty or integrity may see a tax agent proscribed from providing tax agent services. Likewise, such a failing may form the foundation for the Board’s opinion that a person is not a fit and proper person to be a tax agent and so, should have their registration terminated. Again, termination of registration would prevent someone from providing tax agent services.
THE ISSUE IN THESE PROCEEDINGS
The issue is not, at this stage, whether the Applicant’s registration should be terminated. That question will be decided when the application is determined after a final hearing.
The present issue is whether the termination can be stayed until a final hearing, thereby allowing the Applicant to continue to provide services. The stay power is found in section 41(2) of the Administrative Appeals Tribunal Act 1975 which provides:
The Tribunal may, on request being made by a party to a proceeding before the Tribunal (in this section referred to as the relevant proceeding), if the Tribunal is of the opinion that it is desirable to do so after taking into account the interests of any persons who may be affected by the review, make such order or orders staying or otherwise affecting the operation or implementation of the decision to which the relevant proceeding relates or a part of that decision as the Tribunal considers appropriate for the purpose of securing the effectiveness of the hearing and determination of the application for review.
The matters relevant to the granting of stay are well established. In Scott v Australian Securities and Investment Commission [2009] AATA 798 (Scott) Downes J, President, considered the matters that were relevant to the grant of a stay. They include but by no means are limited to:
(i)the prospects of success;
(ii)the consequences of the refusal of a stay for the applicant and for others;
(iii)the consequences of granting a stay for the respondent;
(iv)the public interest;
(v)whether the refusal of a stay would render the final relief nugatory;
(vi)the time between the granting or refusal of the stay and the final hearing and decision; and
(vii)any other matters that might be relevant.
This approach has consistently been applied by the Tribunal and I will apply it here, especially as in this case, the above case law was made known to the Applicant and it was suggested that he familiarise himself with these grounds to formulate submissions, which as explained above, I have been denied the privilege of hearing. I will return to consider these matters after referring to a little of the background.
It is necessary to highlight that the Applicant bears the onus of satisfying me that a stay should be granted.[12]
BACKGROUND
[12] Re Oaklands and Australian Securities and Investments Commission [2011] AATA 199 at [11].
The Respondent’s position and contentions
The decision and its consequences have been outlined in paragraph 1 of these reasons. For the sake of abundant caution, I will again emphasise that the following summary is not an exhaustive chronology of the case, as that is not necessary at this stage. Further, and importantly, I will emphasise that I am not expressing a final view on the background or the facts that give rise to the matter, as that will be considered fully upon a final hearing. However, to properly consider whether a stay is to be granted, I must familiarise myself with the issues before the Tribunal to assess the likelihood of any success at a final review hearing.
The Respondent alleges the Applicant has breached 5 key areas of the Code of Conduct contained in the Act. Ordinarily, I would not slavishly summarise nor extract the allegations but given the orders sought by the Applicant and my findings, feel it necessary to do so. Below is a summary of the allegations made by the Respondent:
Allegation 1
The Applicant’s conduct fell well short of 30-10(1) of the Code, and that he failed to act with honesty or integrity because in the following transactions (unedited)[13] (I have substituted the names of the affected individuals to protect privacy):
“a. amending the ITR for the period ending 30 June 2021 for (taxpayer 1), who had not been a client of Mr Colin’s for four years, without his knowledge or authorisation and claiming deductions which resulted in a refund of $XX from the ATO that Mr Colin kept and subsequently made false statements to the ATO and Board in relation to those amendments.
b. Changing the financial institution account details for (taxpayer 1)to a bank account under Mr Colin’s own control, without first obtaining authority and consent from (taxpayer 1) to do so.
c. amending the ITR for the period ending 30 June 2020 for (taxpayer 2),
without his knowledge or consent and claiming deductions, and subsequently making false statements to the ATO and Board in relation to those amendments.
d. amending the ITR for the period ending 30 June 2020 for (taxpayer 3), without his knowledge or consent and claiming deductions, and subsequently making false statements to the ATO and Board in relation to those amendments.
e. amending the ITR for the period ending 30 June 2021 for (taxpayer 4), without his knowledge or consent and claiming deductions, and subsequently making false statements to the ATO and Board in relation to those amendments.
f. lodging the ITR for the period ending 30 June 2021 for (taxpayer 5), without
his consent or knowledge and claiming deductions, and subsequently making false statements to the ATO and Board in relation to this lodgement”.
[13] Folio 47 of the T Documents
The investigation into this conduct by the Board resulted in third party statements being obtained from the affected individuals which verified the interpretation of events by the Board.
Allegation 2
The Applicant failed to comply with 30-10(2) of the Code in that he did not comply with the taxation laws (relevantly and unedited):
a. in his capacity as an individual, he failed to pay taxation debts as and when they fell due, including:
i. an Income Tax (IT) account debt of $22,406.87
ii. an Income Tax (IT) account debt of $19,352.10
b. in his capacity as sole director of the company Southern Beaches Accounting
Pty Ltd (Southern Beaches), he failed to ensure the company paid its taxation debts as and when they fell due, including:
i. an Income Tax (IT) account debt of $49,399.29
ii. an Income Tax (IT) account debt of $60,673.74
c. in his capacity as an individual, failed to correctly report his personal income and expenses, and rental income and expenses in his individual ITR for the period ending 30 June 2020 by:
i. declaring total taxable income of $38,000, when the actual total taxable income was assessed by the ATO as $94,124, resulting in a tax shortfall of $1,442.90 and penalty amount of $721.50.
d. in his capacity as an individual, failed to correctly report his personal income
and expenses, and rental income and expenses in his individual ITR for the period ending 30 June 2021 by:
i. declaring total taxable income of $21,628, when the actual total taxable income was assessed by the ATO as $24,494, resulting in a tax shortfall of $19,352.10 and penalty amount of $9,767.05.
e. in his capacity as a director of Southern Beaches, failed to correctly report all
the assessable income and business expenses in the ITR for FY2020 and FY
2021 by:
i. declaring total taxable income of $47,719 for the financial year ending 30 June 2020, when the actual taxable income was assessed by the ATO as $204,694 resulting in a tax shortfall of $47,093 and penalty amount of $23,546.50.
ii. declaring total taxable income of $0 for the financial year ending 30 June 2020, when the actual taxable income was assessed by the ATO as $198,723 resulting in a tax shortfall of $59,616 and penalty amount of $29,808.
f. in his capacity as a director of Southern Beaches, failure to correctly report
and claim Input Tax Credits (ITCs) on acquisitions for the periods 1 July 2019
to 30 June 2021
i. declaring total GST amounts of $5,129 for the financial year ending 30 June 2020, when the actual ITCs claimable was assessed by the ATO as $29,340 resulting in a GST shortfall of $24,211 and penalty amount of $12,105.50.
ii. declaring total GST amounts of $2,115 for the financial year ending 30
June 2021, when the actual ITCs claimable was assessed by the ATO
as $10,254, resulting in a GST shortfall of $13,925 and penalty amount of $6,962.50.
g. in his capacity as a director of Southern Beaches, failed to correctly withhold
and notify to the ATO amounts at labels W1 and W2 in activity statements for periods 1 July 2019 to 30 June 2021
i. declaring $0 PAYGW for the financial year ending 30 June 2020, when the actual amount of PAYGW was assessed by the ATO as $35,028 resulting in a failure to withhold penalty amount of $35,028.00 and a final failure to withhold penalty, after 50% remission, of $17,514.00.
ii. declaring $0 PAYG for the financial year ending 30 June 2021, when the actual amount of PAYGW was assessed by the ATO as $9,705.85, resulting in a penalty amount of $9,705.85 and a final failure to withhold penalty, after 50% remission. of $4,852.90.
Allegation 3
The Applicant failed to comply with subsection 30-10(7) of the Code because he failed to act competently because (unedited):
a. in his individual capacity, for the following client income tax returns, Mr
Collins, failed to:
i. make sufficient enquiries to satisfactorily establish deductions that were correctly claimed
ii. Have adequate substantiation for those deductions
iii. Provide the clients with the ITR or amended ITR for their review prior to lodgement;
iv. Obtain the clients’ consent to lodge the ITR: (5 clients)
Allegation 4
The Applicant failed to comply with subsection 30-10(11) of the Code, because (unedited):
allowed Southern Beaches Accounting Pty Ltd, an entity of which he is the sole
director, to advertise that it can provide tax agent services when it is not registered to do so with the Board.
Allegation 5
37.The Applicant failed to comply with subsection 30-10(14) of the Code, in that he did not respond to the following requests from the Board in a timely, responsible and reasonable manner:
c. An order of the Board dated 11 August 2020 to:
Complete and pass Ethics and Governance (module) offered by CPA by 11 January 2021
The Applicant’s position and contentions
The Applicant has not provided formal submissions but rather a number of emails which I will adopt as ‘submissions’ for the purpose of this stay application. I note the Applicant has not furnished any argument or evidence disputing the specific allegations made against him, which has in previous cases been determined to be a significant factor that would weigh against the granting of a stay.[14]
[14] Poidevin and Australian Securities and Investments Commission [2018] AATA 124 at [40].
In response to the above and in support of the stay of proceedings, the Applicant has submitted (unedited):
At the end of this week I can longer trade due to my de registration by the TPB. It's extremely unfortunate but I doubt I have any other way of bringing in the income needed for our survival as a Family, if any income at all during my appeal. As I cannot work for another Accountant and it's the only occupation I have had for over 25 years. And
my partner's (Michelle Turner) income solely relies on our company as she is the Office Manager. And Michelle hasn't had any other employment for over a decade as she was a homemaker, raising children and studying.
We share a monthly mortgage repayment of $8100 a month. Monthly car repayment of $1295. Our Son Chayse attends a Private School to help with his significant learning difficulties. Plus all other living expenses. Unfortunately if I cannot trade we will lose our home and everything we have worked so hard to achieve as we started out with absolutely nothing within three to four months. My partner Michelle and our Son will have to move in with her Mother but I cannot stay because there's not enough room in her 2 bedroom/1 bathroom unit. And our pets, 2 Staffordshire Terriers and three cats will end up in the pound.
We are all humbly begging for consideration and I apologise for the lateness of my request as we have been looking into other avenues of revenue. And have been waiting on responses from our broker to try and stretch out our loans but of course they require financial documentation that will show our employment status.
I truly love my Family, my occupation and my business. I may have needed some extra support over six very stressful years however I'm going to employ another Accountant to help and make better choices for my Family as I don't want to lose them. Thank you again for your time and consideration.[15]
[15] Email/submission dated 13 March 2024
I am struggling to make ends meet at the moment and de-registration of my license will cripple me financially. Please find attached my mortgage payment disclosure for the stay hearing. It is variable for $8148.74 per month and my car repayment of $1293 per month. I also have a lot of other expenses.[16]
[16] Email/submissions dated 20 March 2024
I just want to say I have committed no fraud in my life and think is unfair I be deregistered for having a tax debt and lodging 6 tax returns out of 1200 without signatures.
I am really hoping that your office can overrule this decision based on the fact that I have done nothing majorly wrong.
I applied taxation rules in my tax ration my opinion and was hit with a $300k tax debt of which I have Mostly paid.
I am on a small monthly repayment as we have pay my mortgage but I will pay the debt if I can trade in July.
I am writing this email in good faith.[17]
I need to stay (sic) as I have a close knit family and pets (2 dogs and a 3 cats) and we have a mortgage and will lose everything should we not trade (especially in July and August). I am also paying my car off so I need to stay. I have other expenses like insurances and food and will not be able to pay for those items in I don’t trade (sic)
It is in the public interest I stay as I will be lodging BAS and clients will be paying GST and also lodging tax returns and clients will be paying taxes. It is also of note that I have a tax bill with my personal and company affairs and I will need to trade to pay those debts off. This is in the public interest that I pay my tax bills. I will not be able to it if become deregistered and I will have no income.
Please note that it has been a very rough few months for me and the deregistration form the TPB have had a huge impact on me emotionally. Who wants to lose their successful business?
I will reinterate that I have not done much wrong, ie lodge 6 clients (out of 1200) without signature, and did not pass a course (which I am now doing). I have never committed fraud during my 26 year career (which is generally why Agents get de-registered).
I would like the Commissioner to know that I will do everything right and comply with the TASA Act and am remorseful for some of the things that I have done to get me deregistered. I apologise profusely for the minor things that I have done and will rectify my actions should I stay.[18]
[17] Email/submission dated 28 March 2024
[18] Email/submissions dated 10 April 2024
SHOULD THE DECISION BE STAYED?
The decision in Scott provides a framework for dealing with stay applications. The six considerations referred to in that decision are not intended as an exhaustive list of matters which may be relevant. I will deal with each point below. In doing so, I acknowledge I must keep in mind the nature of the power being exercised and the objectives evident in the Act.
Prospects of success at review
To repeat, it is not my role to make a decision on the final merits of the case. However, I must assess whether, having regard to all the evidence presently available, there would likely be the potential of success at any final review hearing. [19]
[19] Re Oaklands and Australian Securities and Investments Commission [2011] AATA 199 at [20]; Evans and Tax Practitioners Board [2019] AATA 1408 at [171]-[172].
As things presently stand and without dealing with the actual evidence and full argument, the prospects of success do not appear strong. The evidence appears to be straightforward, supports the allegations and point only in one direction. The extensive third-party evidence from five different taxpayers confirming that the lack of interaction with the Applicant regarding amended returns is alarming. It is difficult to conceive that the third-party evidence will be discredited at a final hearing. I cannot ignore the fact that the Applicant has failed to address these allegations but has provided a blanket denial in relation to any fraud or wrongdoing. It is not necessary or useful to say much more about the strength of the case and its prospects of success especially given that there may be more, or different evidence at the final hearing and given that I have not heard full argument about the case. It is sufficient to note so far that the Applicant does not appear to be on strong ground.
The Applicant does appear to however concede that he has done “minor things” and is “remorseful” and will “rectify my actions”. In an email dated 26 March 2024 the Applicant wrote “I now realise the seriousness of the situation that I am in”. This does appear to be somewhat of a concession. Overall, I do not consider that the prospects of success are strong on the basis of the evidence and submissions/emails forwarded in relation to the application for a stay and so find I am satisfied this consideration counts against ordering a stay in the circumstances of this case.
The consequences of the refusal of a stay for the applicant and for others
The Applicant has submitted that the refusal of a stay will be financially crippling particularly during tax season (that is the first quarter of the financial year). He also maintains his client’s will be disadvantaged. He submits termination of registration will result in a loss of income and thereby an inability to meet his outstanding taxation obligations.
I cannot ignore the fact that the Board notified the Applicant of its intention to investigate his conduct on 13 September 2023,[20] yet the evidence suggests the Applicant continued with the purchase of a Villa in October 2023.[21] However, I also note that in the email forwarded to the Tribunal, the Applicant states that he purchased the Villa prior to receiving his tax bill. Nothing turns on the date of purchase. I therefore find any financial hardship arises out of personal choice and not the consequences of a refusal of the stay.
[20] Folio 1729 of the T docs
[21] Folio 32 of the T docs
I accept that refusing to stay the decision will also cause inconvenience to the Applicant’s clients, but again, there was little precise evidence about how many clients or even which clients might be adversely affected by refusing stay. All decisions terminating the registration of tax agents will, of course, necessarily inconvenience clients. However, if the Applicant is able to proceed his matter expeditiously and dispel the allegations at final review hearing, any impact may be contained if he is successful in reversing the decision.
Further, the Applicant maintains he has been incapacitated. If this is true (and I have expressed doubts regarding the certificates furnished to me), financial hardship will not arise from the stay decision but rather inability to work on account of an undisclosed medical condition/s. I am satisfied this consideration counts against ordering a stay in the circumstances of this case.
The consequences of granting a stay for the respondent and the public interest
I cannot emphasise enough the role of tax agents as an important one in our society. Agents are the interface between the public and the tax office, helping Australian’s navigate and comply with the exceptionally complex and ever-changing taxation legislation. Trust and integrity are the foundation of any relationship between a tax agent and his/her clients.
It is significant that the Respondent has made an adverse finding against the Applicant which has led it to the conclusion that the public should be protected by terminating his registration. That is consistent with its role and, more importantly, the object of the Act. I find the public interest is likely to be adversely affected by the Applicant continuing to act as a tax agent, even if for a limited time. Sight should not be lost of the fact that the whole of the scheme of the Act is directed to the public interest in supporting trust and confidence in tax agents. That interest is damaged in circumstances where the Board, as regulator, has determined that the Applicant has engaged in acts of misconduct, contravening the Code, and which fall short of the conduct and registration requirements for tax agents. Should the Applicant be permitted to practice for a short time until the hearing, the public interest will be damaged. I am satisfied this consideration counts against ordering a stay in the circumstances of this case.
Whether the refusal of a stay would render the final relief nugatory
The effects of the refusal to stay the proceedings will be temporary (assuming the Applicant is successful at review hearing) and will encourage the Applicant to proceed to final hearing with some expediency.
The stay will not render the final relief nugatory. I am satisfied this consideration counts against ordering a stay in the circumstances of this case.
Any other matters that might be relevant
The Respondent informed me that it is ready to proceed to hearing and could do so within four to six weeks. Consistent with the Charter of the Tribunal, the decision will be made soon thereafter. The fact that a hearing can be listed in the near future, and the matter will be decided shortly thereafter, will significantly ameliorate any hardship to the Applicant and inconvenience to his clients should he be successful. That approach was one that Downes and North JJ referred to as being desirable in Australian Securities and Investments Commission v PTLZ [2008] FCAFC 164 at [29].
CONCLUSION
Weighed together, the considerations suggest it would be inappropriate to order a stay – even a stay on conditions. I find that the public interest is at risk on several levels and the allegations (particularly allegations of dishonest conduct) are such that the public is entitled to the benefit, for now, of the Respondent’s decision.
DECISION
It follows that the application for a stay is refused.
I certify that the preceding 54 (fifty -four) paragraphs are a true copy of the reasons for the decision herein of Senior Member Benk
...........….................[SGD]................................................
Associate
Dated: 28 June 2024
Date of hearing: 18 June 2024 Date final submissions received: 18 June 2024 Counsel for the Respondent: J Sproule Solicitors for the Respondent: A Seremetis & E Markesinis, Tax Practitioners Board
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