Chartered Accountants Australia and New Zealand (CA ANZ) has submitted its recommendations to the Productivity Commission, focusing on economic collaboration and the modernisation of Australia’s tax system.  

The submission, which covers four of the commission’s five interim reports, also advocates for making digital reporting the standard for entities. 

The accounting body emphasises the need for a more efficient tax mix and a lower corporate tax rate, albeit acknowledging the budgetary challenges involved. 

For the corporate tax system, CA ANZ agrees with the shift towards an efficient tax structure.  

However, it warns that transitioning to a Cash Flow Tax could be complex and expensive.  

The focus, they argue, should be on modernising the existing framework to better fit the current economy. 

CA ANZ CEO Ainslie van Onselen said: “CA ANZ agrees that tax reform is needed to ensure our economy is strong and are advocating for the interim recommendations to take into account other significant tax settings, which affect business investment decisions for significant parts of the economy.  

“This is the logical step forward and we strongly believe this reform will unlock productivity, improve accessibility to our capital markets and bring Australia in line with global best practice.” 

Regarding the company tax rate, CA ANZ supports the principle of reducing it to 20% for all companies. However, it recognises the significant role corporate tax plays in the national budget, making this a challenging objective to realise. 

On environmental policy, CA ANZ backs the proposal to expand the Safeguard Mechanism to include more industrial facilities and enhance carbon leakage provisions.

It suggests a phased approach for the inclusion of new facilities to manage the transition. 

When it comes to AI, CA ANZ agrees that AI-specific regulation should be a last resort.

They stress the importance of a flexible regulatory environment that can adapt to the rapid evolution of AI technologies, without compromising stability. 

CA ANZ also supports the removal of unnecessary occupational entry regulations, particularly in the financial advisory sector and advocates for qualified accountants to be allowed to provide strategic financial advice, which could help address the shortage of professional financial advisers in Australia. 

Earlier this month, CA ANZ expressed its support for the reintroduction of accounting as a standalone subject in the NCEA Level 1 curriculum from 2028.