The International Ethics Standards Board for Accountants (IESBA) has announced that the inaugural global ethics standards on tax planning, introduced in April 2024, have become effective.  

The standards create an ethical framework to guide professional accountants in tax planning services, enabling informed ethical decisions in this challenging field.  

Rather than focusing only on technical rules, accountants adopt a principles-based approach for consistent tax planning guidance.  

Other tax practitioners can also adopt this framework to meet a high ethical standard. 

IESBA stated that the framework’s objective is to ensure tax planning decisions consider the public interest, have a credible basis in laws and regulations, and account for potential reputational, commercial, and broader economic consequences that the tax planning arrangement could give rise to. 

Amid increasing public criticism of tax avoidance practices that erode trust and harm corporate reputations, these standards provide accounting companies and tax practitioners with a robust ethical foundation for tax planning advice.  

This fosters greater public and institutional confidence in taxation, central to the implicit social contract between taxpayers (individual and corporate) and their societies, the standard-setting board said.  

IESBA added that Australia, Hong Kong SAR, Saudi Arabia, Singapore, and South Africa have adopted these standards. 

IESBA chair Gabriela Figueiredo Dias said: “Today marks an important milestone for IESBA and the global accounting profession.

“The Global Ethics Standards on Tax Planning provide a vital tool to help firms and professionals navigate the complex and often grey areas of tax planning, ensuring the public interest remains at the forefront. I commend all those who are leading the way by adopting or working towards the adoption of these standards.” 

In April, IESBA initiated a public consultation to examine auditor independence in the context of audits of collective investment vehicles (CIVs) and pension funds.  

The consultation paper invites feedback on whether updates to the International Code of Ethics for Professional Accountants are needed to address auditor independence in these specific audits. 

Investment funds and pension schemes often rely on third-party service providers for tasks typically handled in-house in traditional corporate structures.  

This arrangement creates relationships that require thorough evaluation to identify and manage any potential threats to auditor independence.