The financial advice sector faces growing uncertainty as the Compensation Scheme of Last Resort (CSLR) levy is expected to rise to A$127 million ($82.7 million) by 2027, according to statements from CPA Australia.
This updated estimate far exceeds the A$75.7 million tax forecast for the 2026 financial year and eclipses the A$20 million limit previously set by the Australian Securities and Investments Commission (ASIC).
For comparison, the tax levied on advisors in 2024 amounted to just A$4.8 million.
CPA Australia financial advice spokesperson Richard Webb said: “This is another disproportionate and punishing result for advisers who have acted responsibly.
“Legal and regulatory reforms in 2024-25 have already squeezed the sector. Now these tax increases could drive out many more advisers, just when Australians need them most.”
The sector’s adviser population has seen a sharp decline, with numbers on the Register of Financial Advisers falling from 26,500 in 2019 to approximately 15,300 in July 2025.
If current projections hold, each adviser could face an average annual tax of A$8,300.
Webb described the scheme’s funding framework as “broken” and called on the government to speed up its review process relating to the tax structure.
Webb further added: “Not only are professionals being let down, but consumers are also being punished because the tax increase will inevitably increase costs for Australians seeking affordable advice.
“An effective CSLR must protect genuine victims without collapsing the entire advice system. We urgently need a tax model that is actuarially sound, legally limited and fair for today’s professionals and their clients.”
CPA Australia is a member of the Joint Associations Working Group, a coalition of ten industry bodies focused on improving access to financial advice.
In recent statements, CPA Australia urged policymakers to take steps to further develop Australia’s economic connections with Asia, stating that insufficient engagement could limit business opportunities for Australian businesses in key markets.
“CPA Australia flags risks amid CSLR tax hike” was created and originally published by The Accountant, a brand owned by GlobalData.
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