Paul L. Caron
Dean


Tuesday, June 30, 2020

Rethinking Privilege For Tax Professionals

Samuel Singer (University of Ottawa), Rethinking Privilege for Tax Professionals: A Tax Policy Perspective:

In Canada, information exchanged between an accountant and a client, while confidential under professional codes of conduct, is not privileged unless it falls within limited common law exceptions. Some countries have legislated to extend limited privilege to accountants, but Canada has not yet done so. This paper uses tax policy principles to critically evaluate the differential treatment of lawyer-client and accountant-client relationships under the rules of privilege in Canada. From a fairness perspective, the distinct treatment of taxpayer information based on the tax advisor consulted is inequitable. Differences in access to privilege create distortions in the tax advice market and increase complexity.The paper also identifies justifications for not extending privilege to accountants.

Tax lawyers owe special duties to the administration of justice, but accountants do not. Taxpayer rights must be weighed against a state’s need to prevent tax avoidance and evasion. A modern balanced approach may lie in the legislated recognition of limited privilege for accountants, while allowing for clear exceptions to continue to facilitate tax administration.

https://taxprof.typepad.com/taxprof_blog/2020/06/rethinking-privilege-for-tax-professionals.html

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Comments

The very wealthy which are the common targets of intrusive government will most likely have their taxes done by a accountant with a law degree for confidentiality.

Posted by: dunce | Jun 30, 2020 2:30:09 PM

Dear Dunce: The very wealthy have been aided and abetted in accruing that wealth by tax and other policies from the beginning of the Republic--including slavery and Jim Crow. The idea that they have been 'targeted' is absurd. Wealth generates influence, and that influence creates favorable laws. All you have to do is look at the absurdly limited amount that the U.S. collects in estate taxes, which allow the extraordinarily wealthy to pass on significant portions of their assets after having paid little or no taxes in their lifetimes and with little or no tax upon their death, with heirs receiving much of the cumulated wealth with a step-up in basis that sets them up for a life of even greater accumulation.

Posted by: TaxGal | Jul 1, 2020 2:15:04 PM

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