Under The Hood: 'Uncontroversial' tax proposals ahead of the SA state election

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For those of you who don't know me, I'm the managing editor of Accountant Staley, and moving forward, I'll be sporadically hosting episodes on this show. And for my first run, I'm very pleased to be joined by Adrian Cartland, who is a South Australian-based lawyer. He's the principal solicitor of Cartland Law, and I understand he also goes by the moniker of the taxinator. Adrian, welcome to the show. Thank you for having me. I'm the taxinator. I'm here because I can speak like Arnie. That's really my good skill. But besides that, I'm a tax lawyer. Adrian and I are going to be discussing a manifesto that he recently released all about some needed changes to the tax system in South Australia. I'm really keen to get Adrian's take on the state of affairs for the taxation system in South Australia. What needs to change in order to ensure greater efficiency and equity in the system. And we're also going to discuss the importance of advocacy for both tax and legal practitioners in arguing for needed legislative change. Adrian, before we get into all of that, tell us a little bit about yourself and the work that you do with your firm. So I'm a tax lawyer, a pure tax lawyer, I do tax trusts and technology. So I decided that I wanted to be a tax lawyer when I was at university. I found myself reading the Master Tax Guide on my school holidays. After that, I thought, look, this is it. What really interested me about tax is that it's so complex and there's so many things that I can do with this. So I come from a family of engineers who build things. I'm not clever enough at maths, otherwise it would have been an engineer or an accountant. So I had to be a lawyer. But I still like building things. And so to me, tax is like a big bundle of bricks to build things out of. There's so much complexity and so much room for uncovering really good problem solving. I think I like to say that I fix things that are broken and break things that are fixed. I love that. That's such a cool description for it. And I imagine the work must be particularly interesting at this current moment in time, given certainly all the political discourse around potential changes to the tax system, but also given the market change we're seeing, like, you know, the advent in mainstreaming of new technologies, for example. So I imagine there's never a boring day for you. There's not a boring day. One of the problems, though, from an advocacy perspective, is this is really, we've really drifted sideways for 20 years, both federally and then from a state perspective. And, you know, the economy has been pretty good for some period of time. People have got complacents. Now we're heading into a period where the interest rates have been rising. Things have been a bit tougher. The states have spent the states and the color wealth have spent huge amounts of money in COVID. Where are they going to get that money from increasing taxes? And they're either doing it directly or indirectly through not remitting general interest charge or making it more difficult or having a tax office has become more aggressive. Now, what I'm really interested in is my work as a practitioner who is, is gets his hands dirty. One thing that I think is really problematic with the tax reform agenda is that none of the politicians seem to have any kind of experience other than being a politician. So, so how can they provide some kind of ideas? At least 40 years ago, we had politicians who were ideologues, labor, labor, and liberal, doesn't really matter which, who came to it with a bunch of ideas that were based on some kind of fundamental principles. Now, there are a bunch of managers who are trying to, you know, just keep things ticking over and we get a bunch of rather sad and uninteresting tax reform or rather lack their own. Well, like you, I come from a legal background. And what I've always heard with regard to parliamentarians is that there are too many lawyers in the house of reps or in the Senate. So, I'm sure we can't strike the right balance for everybody. Yes, but I think the difference between law and what we're doing here is there's a difference between understanding law as in rules and then the tax system which comes from an economic perspective which has like a fiscal element and it's not just for lawyers to draft lots of words, which is something that they're good with and, you know, and respectfully to other lawyers that they're good at standing on their feet and blowing a lot of wind. So, really what we need is more accountants. Yeah, there's a good line there. Now, Adrian, let's get into the crux of our conversation. Now, you recently published a manifesto arguing for the need for a fairer go for tax payers in South Australia. And as the starting point, it might be worth painting a picture for the state of affairs for, you know, the tax landscape in the state before we get into the Y and the house of your manifesto. So, yeah, give us a lay of the land. Certainly. So, just for some context, I'm the chair of the state of the state taxes committee for the tax institute and so I've on the state taxes liaison groups. I see the state commissioner week and work with administrative material. There are certain things that you can feedback that you can give in relation to rulings and things administratively. On the other hand, there's a lot of changes that require legislative change. Now, one of the, let's just talk about state taxes. The fundamental problem with state taxes is that there's very little that you can do with them. But constitutionally, there are only a few will not taxes or exercises that this state governments can levied the land tax, stamp duty payroll tax and, you know, and so on. And so it's very difficult to have big ticket ideas. So, we can't introduce a GST. Now, federally, they can and it's supposed to come to the states. But, you know, with South Australia, it couldn't just introduce its own GST or add an extra 1% or something like that. They got rid of their income taxes. So, what can they do? And then what happens from a policy perspective is that we get stuck with, you know, there's some big ideas that like a abolished stamp duty, which is really nice. And then it becomes, where do you pay from that from? And this then leaves you with some intractable, intractable problems. Of your either coming up with something really big like, you know, either introduce a brand new tax, which no government likes doing or abolishing some tax, which, you know, no government likes doing. When you're stuck on that, then you, if you can't do those big things, big ideas, what do you do? Well, then you're going to tweak things at the margin. Let's change the payroll tax rates or the land tax rates. You're a little bit here and there to keep up with inflation. Okay, but that's not really state taxes reform. Now, the force and context for South Australia a few years ago, we had what I think was the worst tax reform implementation that I have seen. Worse than the mining tax, the Julia Gillard attempted to introduce in South Australia, we introduced a huge change to our land tax regime. And why it was really bad was it was administratively done awfully. It was initially slated as a tweak to anti avoidance rules in order to stop de grouping through use of trusts and companies. It was a total rewrite of the rep of the rules of the of who tax falls upon revenue essay or revenue essay has been years trying to catch up on the huge burden. It was a total mess there, then they tweak the rules and it essentially didn't raise any revenue. So now the fundamental problem with this is that when they implemented this rule normally an anti the anti avoidance provision gets or administrative tweak gets waived through with both houses parliament, they, you know, someone that there's the tax law amendments bill number five. No one pays attention to they tick the boxes and it goes through in this case it didn't happen and and it was very bad and the thing that matters to me as a tax practitioner is not so much the the headline numbers who would go on that's a political issue. It's about how it's actually implemented and so what's bad in that scenario is that revenue essay what they didn't give them the correct resources to do this they didn't consider how taxpayers were going were going to properly assess a totally new grouping structure. It was explained to taxpayers as just we're chained we're tweaking things from anti anti avoidance perspective where I was as a total rewrite. So that is an example of things have gone very badly and I've come up with a number of suggestions that I believe a comprehensive series for close reform based on other implementations in other states and and federally and these should be very boring things. We're chatting with Adrian Cartland and we'll be back with more wrote up for this. Accountant daily is once again on the lookout for exceptional accounting professionals and businesses to join us for the highly anticipated Australian accounting awards 2026. It's time to recognize and celebrate the incredible achievements of those shaping the future of the industry. Submissions and nominations are now open. Get involved this year by either submitting or nominating a colleague or team entering is completely free and provides the opportunity to gain exposure and bootcamping. This is your chance to be known as an award winner and open the door to undeniable opportunities. Visit Australian Accounting Awards.com.au today to get involved. So Adrian we're going to get into some of those headline proposals from your manifesto in a second but just before we do and as a follow up to what you were just detailing there about the system in South Australia. What is the overarching message or takeaway you know from your manifesto that there are things that are un but should be uncontroversial that can bring great benefit to taxpayers to government to revenue and to tax practitioners. So instead of looking for some kind of big big headline exciting thing abolished payroll tax, stand to the land tax with whatever it is or increase it, change it whatever these are very boring administrative things born from practice and experience that that should be revenue neutral but any government should be able to implement that will that will assist both taxpayers government revenue and tax practices. So Adrian I want to ask you about a couple of these proposals and why you think they're important. I'm going to start with and I'm just reading off my notes here the anti overtaxing provisions. What's this about and why is it necessary. Yes so one thing that's very interesting from a from a tax perspective is that we have anti-voidance provisions and I also have a separate comment about anti-voidance provisions. But we and so the commissioner can apply things from a proposive perspective that is to say if the commissioner she is that if she doesn't think that a that the provision is operating in its intended manner and on its plane reading that then that we can look behind it to the purpose of it and then read it in some other way. And that's fine we can understand why that might might occur and in fact I propose a separate proposal to indeed strengthen the commissioners powers on that. And the other hand this if something operates in a harsh or oppressive manner that unduly hits a taxpayer where it's not supposed to the commissioner can the does and we can rightfully put her hands up and say well there's nothing I can do about it that's a plane reading of the act. And so this can be very and so this would give the commissioner powers to be able to say in this circumstance this the intended purpose of this act is to operate in this way. And so if someone is getting double text or they're meant to be exempt but for some reason an interaction of different provisions operate in a harsh or oppressive way in a manner that's not intended we can say look at the purpose of it. Let's execute this purpose okay let's move to another one reforms to payroll tax grouping provisions yes so payroll tax grouping is something that's very problematic because it is exceptionally broad now it's meant to be broad as an as an anti-void is provision but the the plane reading of this can have very terrible consequences for example and accounting foam and their client accounting foam is providing services to their clients. Given that this is one business of giving services to another there is no reason why on ordinary reading of the act that they are not grouped and then we can we could look at a there is no reason why the commissioner cannot choose larger and larger groups to encapsulate subgroups there to my reading and I'm I'm I'm happy for people to put push back on this but to my reading there is no no reason why the commissioner couldn't say there is one super group of every person on the electoral role. And therefore group every single person now you'd say Adrian you're just being silly no I'm say well this is the logical extension of the way laws are being implemented at the moment there are businesses that I'm seeing that are entirely unrelated and that we're and that are being groups now there are specific ways that you can apply for de grouping but this is time consuming any inexpensive what we want to do is we want to set out we want to group taxpayers are related and not group taxpayers that are unrelated. Fair enough another one I wanted to ask you about is the need for a consistent definition of charity across tax laws yes now i've said that these these these proposals are very boring and and mundane this is this is something that should be quite boring we know what a charity is I mean this we it goes back to the statute of Elizabeth but in South Australia and our definitions of charities are different for the for stamp duty payroll tax land tax. And so so you can find charities that that are exempt federally but then might get get might get hit with one two or three state taxes now if something is a nonprofit it should be receiving it should not be taxed federally should not be taxed at a state basis the charities go to have lunch and outs of money and they are literally non for profit they're they're trying to do something good for the community now if we do recognize them as a doing that then we should make their life is administratively simple we should like for example you said if you're registered as a federal nonprofit there you have exemptions from all these three yeah and Adrian order some of the other headline proposals that you think are of most significance here that that I haven't listed on my notes here yes so I think that we should have a private ruling system and so one thing that can be quite particularly with state taxes like stamp duty if you're going to have a community if you're going to enter into transaction and you don't know what the answer is and you don't know how revenue say might might treat something you should be able to ask other states you know new South Wales Queensland they have private ruling systems the ATO does and before you sign on the page and incur the you should be able to find out from the commissioner now this would benefit the commissioner safe time with disputes explaining things after and in fact who who publish these private rulings then people can understand the revenue assays reasoning which extends the commission is influence and can create certainty for tax payers so this is this is something that there's been a lot of support for people have raised that specialist the state tax and unfortunately the commissioner doesn't have the power to just implement this herself we need to support the commissioner to to with the legislative power to do this and then I'm going to give you another one and this is my this is my controversial one oh okay please and this is this is proposal number one and I think that we should have a six month time frame for decisions that and and in particular if there is no decision then the answer is yes so this should be on a submission on an objection you know on a where some kind of exemption has been applied for and so let me set out the background to this and then the reasoning now people complain about time frames for for revenue offices and and there's two main ways of approaching this one side of politics will say the answer is we're going to just give them more money and you know expand the revenue offices and from one year to another side of politics says all revenue offices all there's there also bad we need to take money away from them cut things now I don't really care what side of politics you're on that debate hasn't got us anywhere it's got us into stagnation and they both yell at each other and then meanwhile poor taxpayers tax practitioners and revenue offices are just sort of stuck there and they're given more and more burden there's more laws that there's all sorts of reforms in there all sorts of your new burdens put upon them to do so what I propose is that we want to create certainty if say you launch a submission there you say you launch an exemption for land tax see say this is my principal place of residence you you're on objection if the commission is about sometimes the commission will write back plan and hopefully the small things you get answered back really quickly it's the commissioners over burdened or is difficult sometimes it's the takes longer we're seeing things taking years in fact the advice that I usually give to clients can be you might wait years you be you launch an you launch an objection really two or three years sometimes and in fact I've had things take multiple multiple years and to be clear this is not it I'm not taking either one or all the other side of the politics I'm saying that this is just a problem or we need to deal with this and we need to support the commission to be able to deal with this and so if I had launched a submission after six months if I haven't heard anything back I'm in time to rely upon it and the answer is yes so I can say that the answer that I've said that this is my principal place of residence the commissioners hasn't had time to process it this is my principal place of residence I can rely upon it we're done similarly if I if I get an assessment I dislike it I launch an objection instead of waiting back you know again it goes to the commissioner that goes off the crown law might take years after six months if I don't hear anything back the answer is yes now this now what this what this will immediately do is clear a huge new information now that means and that also then creates a permanent stop gap for the commissioners should ever overburdened some new reforms come through there's always this overflow now once we've cleared up this backlog then the commissioner I'm sure we'll be able to do things you know within that time frame so it could be a one off hit and then but always having a backstop to protect the commissioner and the work this has to do I like it it doesn't sound to me sounds as a like a bit of a reverse statute of limitations so to speak but perhaps more pertinently it sounds as though it would ensure access to justice which is of course hugely important Adrian I wanted to ask you in an ideal world the Malan ask us government and the premier and his team they would read this manifesto and agree with all of your proposals that will sail through state parliament if that happened what would be the ultimate outcome for South Australian taxpayers you know why would the system benefit from implementing these changes well the system would benefit was because people would spend less less fees on people like me and that the simple reason is is that when you when you have complexity when you so if someone has to write long objections and then wait if things are unfair on a taxpayer and and they have to object to it if they if there is uncertainty and he just been expensive time do extensive time doing advice they have to come to hand some charismatic tax lawyers like myself and and while that's great from a selfish perspective that's ultimately not good for taxpayers and a particular taxpayers who can't afford a tax lawyer the people who benefit the most out of this are the mums and dads who are just going through the tax system and trying to interact with something that is complex difficult one of the things that I that I particularly like is a proposal for rectification of errors and one of the reasons I see this is because I'll see taxpayers who say that I've done something I've filled out a form in this way but I just didn't understand a form and I've stuffed it up and maybe I may be it's you know some kind of notification maybe they've filled out their land transfer wrong and then suddenly they missed their first home owner grant or they they missed some exemption and they can't afford to spend to spend money on this but if they could write to the commissioner and say look I made a mistake I didn't understand what I was doing can you just fix this this helps the people who need the help the most yeah Adrian have another question or two for you which will get to one the other side of this cyber risks a shifting faster than ever and in 2026 Australia's biggest cyber event is back the Australian cyber summit returns for its fourth year taking place at the star Sydney in April uniting the nation's top cyber experts business leaders and key decision makers delivering sharp intelligence on everything from regulatory change and global pressures to new technologies and advanced threats the summit offers a unique blend of cutting edge insight and connection making it a truly unmissable event secure your ticket now at Australian cyber summit dot a you So Adrian you mentioned a bit earlier in this conversation that this manifesto has arisen out of the work that you do with with the tax institute I'm yours to know I sort of broadly speaking you know why you see it as so important for practitioners you know both tax and legal practitioners to put their hands up and and really advocate for for necessary change you certainly there are some you know some very good professional bodies in the tax and accounting space who are doing that advocacy work but for individual practitioners on the ground why do they also need to be rolling up their sleeves to argue for what they think is right fantastic question now the way that we get reform to happen and a particular boring form because I'm not going to lie state taxes of minister of reform like less exciting than say you know interest rates or immigration but the way that we get this is experts put up to say their opinion and say in my view this would help this this this bolsters the understanding of the government who want who you know politicians one thing that they do well as that listen keep to the people who elect them and the time to do this is now when they're paying particular attention to being to being elected and so if you can if you can say to your local body and I am speaking to all the professional bodies and and and I've ever written to them or I'm in process of consulting with them and done and I have a number of professional bodies that have that I think I am going to get some very positive support from but the way that we do this is with popular support and this is something that these should be known brainers and if we can set to the government of whichever stripes comes into power and we can say this is boring and this reform that is tax neutral that everyone benefits for this is the kind of ways that we implement like positive change. And just finally looking ahead what excites you about your work in this space both your work as a legal practitioner running your own firm but also as an advocate for change. Well, I have a response to do let's you to the profession as a professional I think that's something that I that I really enjoy about what what I'm doing if I think as a profession we can true you back to the profession and even that you know from a narrow perspective I could say that I would that it would be in my interest to have people have as troublesome tax position as possible because they can come to come to me. So I think that we with it as a professional we want to look after our clients and do what is ultimately in their in their best. Now if you don't mind I do have a plug or that is to say I I would make a request of people that they do want to make some commentary the thing that that will make this get over the line is make some kind of public statement. And I don't care if you disagree with me in fact go for it if you find something in there that you either improve upon or rip upon like make that public statement and that is the time now. If there is something that you like upon this I have a petition on my website I'm taking I'm taking signatures and will present this to the treasurer with commentary that you make good about a neutral. There is things to improve upon I want to hear your say so please do contribute to this discussion that is that discussion that makes this work and then it is only with us as profession doing this together that we can implement this kind of change. Adrian Cartland thank you so much for your time fantastic thank you very much and thank you to the listener for tuning in if you enjoyed this episode please give us a rating and review on what of a platform you use to listen to podcasts as it will help other tax and accounting professionals to discover and enjoy this show. And if you've got ideas for other episodes that we can run please get in touch at editor at accountant stale.com.au you can also reach us on social media see you again next time. The information featured in this podcast is generally nature and does not take into consideration your financial situation or individual needs and should not be relied upon before making any investment insurance tax property or financial planning decision you should consult a licensed professional who can advise whether your decision is appropriate for you. Guests appearing on this podcast may have a commercial relationship with the companies mentioned. The Women in Finance Network Lunch is back for 2026 and tickets are on sale now join an inspiring community of women and champions of Women in Finance on Friday 1 May adult and house Jones Bay War. 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