Top tax adviser and female role model Teresa Dyson joins Deloitte as a partner.
Photo: Rob Homer
Tax lawyer Teresa Dyson – the first woman to head the Board of Taxation – is one of a select species. In January she took over from Chris Jordan (now the ATO Commissioner) as the chairman of the peak body that advises the federal treasurer on how to improve the tax system and design laws.
In July, Dyson will leave global law firm Ashurst (formerly Blake Dawson), where she has worked for more than 16 years and advised the nation’s biggest companies on the tax implications of new deals. She’s joining big four accounting firm Deloitte’s Brisbane team as a partner, although she will only work part-time to allow her to balance her current role at the Board of Taxation.
To understand what a rare case Dyson is, one only needs to look at the number of women holding senior roles in the accounting and legal professions.
Data from the 2012 BRW Top 35 Law Firms shows that while women account for 53 per cent of all lawyers, just 19 per cent are partners. In accounting, the situation is even worse. Despite about half of all accountants in Australia being women, very few rise to the top.
BRW’s Top 100 Accounting firms 2011-12 survey reveals that of 2404 equity partners, just 11.5 per cent (277) are women.
If you take the top 20 largest accounting firms in the country, it’s only slightly higher, at 14 per cent.
Dyson, who has been a member of the Board of Taxation since May 2011, says the lack of women in the tax profession is no different to the general lack of females in senior roles in business: there’s not enough flexibility when women decide to have children.
“There needs to be positive messages around what happens when people decide to have children,” she says. “Those messages need to be delivered early so women don’t foresee a problem before there even is one.”
Dyson believes her new part-time role at Deloitte will give her the flexibility she needs. “It requires a fairly tight balancing act of my time, and I think in moving to a role that’s more flexible, it will help me do it all a bit better,” she says.
As well as playing a tax advisory role for the financial services, infrastructure and the resources sectors, Dyson says she will act as a mentor for the firm’s younger team members.
Deloitte now has 40 partners and 500 people in its Queensland office.
Deloitte national tax lead partner Paul Riley says in tax “it’s hard to find someone who is more highly regarded by the business community, fellow tax professionals and the government than Teresa”.
For Dyson, there is also a dual benefit of her liaising more regularly with the people she has to consult with as part of her Board of Tax role. The board was set up by the Howard government in 2000, based on a view that there was minimal interaction between business and government, leading to ineffective tax legislation.
Since then the board, which draws members from the business and public sectors, has advised Liberal and Labor governments on a range of issues, including reviews of international taxation arrangements, the taxation of trusts and establishing the office of the Inspector General of Taxation, which is the body that audits the Australian Taxation Office.
But as its former chairman Dick Warburton once pointed out, “its agenda is largely determined by the Treasurer, often within set terms of reference”. Warburton said that while they can give advice only and are not the final decision-makers, the board now provides “a lightning rod for government by helping to discern community concerns” on tax matters.
Dyson wants the board to have a greater role in helping develop sound tax policy and bring more businesses to the table. “It’s about being a sounding board at an earlier stage, a litmus test on new announcements or new policy directions that might assist the government in understanding the impacts or the way in which certain policies might or might not work in the way they think that they will.”
The board regularly engages with the business community and its key representative groups, but in a way she feels she has to prove she’s got the same standing in business as Warburton did.
“Dick Warburton, as the first chairman, was very well known in the business community,” she says.
“He was able to tap in with a great amount of ease. I certainly feel I have ground to make up, to make a more deliberate effort to ensure the reputation of the board developed over 13 years continues to be recognised at the highest board and CEO levels.”
Dyson says the c-suite is showing “a strong willingness to participate”.
She hopes that whether it’s Labor or the Coalition leading after the election, the board continues to get the same level of government support.
Shadow Treasurer Joe Hockey has made promising noises about this.
In a National Press Club address in May he said “fairer” administration of our tax system would have bipartisan support. “The statements that the Coalition have been making would support that broader level of engagement,” she says.
Cut to corporate tax rate
Dyson, was part of the federal government’s Business Tax Working Group (BTWG), which was charged with the almost-impossible task of advising on how to make a company tax rate cut revenue neutral.
She believes that company tax cuts are worth pursuing, but could not be framed by politicians in the way the working group’s terms of reference were.
“There are very, very strong arguments for a positive impact on the economy from cutting the company tax rate,” she says.
The report the BTWG presented made a case for that, but it also made clear that it had narrow terms of reference, and the cost of cutting company tax rates would have to be offset with matching revenue savings.
“It’s a very difficult task to identify strict matching savings,” Dyson says.
“If we want to go down the path of reducing the corporate tax rate it needs to be looked at from a much broader framework – the impact that a lower rate would have in terms productivity and economic growth, and how that might itself have a secondary impact on level of tax revenue collected.
“I think while [being revenue neutral] is the frame for the discussion, reform will be very difficult to achieve – if not impossible. It would require any government looking at it to take a longer-term perspective. I think the way that it looks at the moment, with the pressure on the federal budget and returning to surplus – that will in itself create a hurdle to look at tax reform in a more full-some way. It’s probably another election term away.”
More straightforward tax
One of Dyson’s main objectives at the Board of Tax, and also when engaging with business clients at Deloitte, is to try to make tax more straightforward. This sounds like an impossible task, but Dyson is adamant she wants to help deliver a more efficient tax system.
The board has three reviews under way – one into Division 7A aimed at stopping shareholders from dipping into private company funds. The other two relate to May budget changes – one examining the “arm’s length test” that applies to the thin capitalisation rules and clarifying when the test applies, the other into debt and equity rules that may allow tax arbitrage.
She says all three reviews have pointed out one main problem: the way the tax regime has developed in this country has been ad-hoc.
One tax law may have completely contrary objectives to another area of tax law. That often results in unintended outcomes; Dyson says this causes much confusion and a threat to the general integrity of the tax system.
“Our tax system is extremely complex, and complex in comparison with many of our major trading partners or economic equivalents,” she says. “It’s developed that way over time. But the fact that it’s complex and difficult, doesn’t mean we don’t strive to get it right when new policy is implemented or when we are trying to improve existing law.
“It does require that deeper consideration.”
There have been recent moves within Treasury and the ATO to work together more closely on the design of tax law. Tax Commissioner Chris Jordan in March announced a new tax law design unit that will work with Treasury on policy and drafting laws. The unit will come under the responsibility of the second commissioner for law design and practice.
“That’s definitely a positive move,” Dyson says. “It will help the ATO and Treasury work more congenially together. Perhaps they have identified cases where maybe that interaction hasn’t been ideal. Now w both agencies are very deliberately concentrating on improving the relationship.”
She says this will result in better outcomes for taxpayers. “There’s a real concern at the middle and smaller business market that things are too complex - that’s something we are mindful of and we certainly don’t want to continue to make things any more complex than they need to be.”
Dyson, named 2011 Woman Lawyer of the Year by the Women Lawyers Association of Queensland, says while graduate intake at firms is fairly even, women’s numbers start to reduce after about three to four years.
This is usually the time when professional service firms expect longer hours and increased workloads. Women see that as conflicting with their personal lives, she says, and decide to leave. This is something she witnessed with many of her female colleagues.
“There is this exodus of females at that point [three to four years],” she says. “I saw them leave before they even started having kids, in anticipation that they would have to once they did.”
Dyson, who has two children under 10, says while it’s hard, people can find a balance that allows them to have a successful work and family life.
“There needs to be a recognition that it’s not easy,” she says.
“People need to understand that different things work at different times. Early on in my career the hours I logged were long. But technology has changed a lot of that now. I think people in leadership roles need to positively embrace changes and technology that enable them to better combine all the elements of their lives.”
As to her own ambitions, Dyson says she’s not looking to do what Jordan did and make the jump to heading the Australian Taxation Office. Hopes that a woman would lead the ATO into a new era of more consultative tax administration were dashed when Jennie Granger last year announced she was off to take a new job with Britain’s Revenue and Customs. Dyson has already made the top of one tax body.
Perhaps that’s why she says a move to the ATO is “not necessarily my intended career path”.