Professionalism in a changing tax environment : the impact of general anti-avoidance legislation on the accounting profession

Tackling tax avoidance has become a priority for tax authorities. The accounting profession has been subject to significant criticism for its role in the promotion and facilitation of what may be regarded as aggressive tax avoidance. In response to this increasing issue of public concern, tax authorities have sought to tackle tax avoidance through the introduction of general anti-avoidance rules and supplementary provisions. These regulatory changes may be regarded as an attempt by tax authorities to disrupt the existing work practices of the accounting profession.In this context, the escalating disruptive work practices are explored, identifying how a tax authority built up layers of disruptive work, at times crossing into categories of traditional creation and maintenance work, in its attempts to tackle aggressive tax avoidance.These disruptive work practices were represented in changes to the general anti-avoidance tax regime. As a result, the accounting profession was impacted both directly and indirectly, where provisions introduced placed new reporting obligations on tax advisers and on taxpayers. The accounting profession’s response is explored, beginning with defiance (where changes were not aimed at it directly), moving to a combination of defiance and compromise (where it faced new reporting obligations) and finally public acquiescence and private avoidance and defiance (where it faced a Supreme Court decision strengthening the tax authority’s powers). The public and private response of the accounting profession are examined, by analysing public documentary evidence, together with interview and focus group data, enabling an in-depth understanding of the accounting profession’s response to regulatory changes to be explored.When faced with disruptive work, tax accountants are seen to engage in a range of different maintenance work practices in an attempt to rebuff changes to their day-to-day work practices and advice given to clients. Once again, the complexity of real life, provides an opportunity to identify institutional work practices crossing traditional categories, with creation work practices identified in tax accountants’ attempts to maintain their status quo.The influence of clients, and society more generally, on both the response of the accounting profession to changes in the general anti-avoidance tax regime and the resulting impact on work practices is identified throughout the study, with the concept of client-led professionalism emerging from the findings.