THE Abbott government will slash the number of foreign accountants able to get permanent visas but local dentists have failed in a bid to impose new restrictions on their overseas counterparts working in Australia.

The government decision to cut the number of foreign accountants came after the Australian Workplace and Productivity Agency rejected a bid by the Department of Employment to have accountants removed from the Skilled Occupation List.

The agency recommends annually which occupations be added or ­removed. Foreign workers whose occupation is on the list can apply for a permanent visa without requiring a sponsor.

Documents seen by The Weekend Australian show the department told the agency that its research showed “there continues to be a surplus of qualified accountants’’ in Australia. But the agency said the department’s was the only one of seven submissions it received that called for accountants to be removed from the list.

Among arguments in support of foreign accountants was that changes to taxation law and regulations would increase demand. “Pending repeals of the carbon tax and the mineral resources rent tax were cited as examples of initiatives which will drive further demand for accounting services, along with changes to superannuation laws,’’ the agency said.

Under the general skilled ­migration program, professionals and other skilled migrants can enter Australia without being sponsored by an employer. While they have to nominate an occupation on the skilled occupation list, there is no obligation for them to work in that occupation.

The government has capped the program at 43,990 skilled visas next financial year. For each of the professions on the list, the number of positions available is capped at 6 per cent of the occupation’s workforce. After the agency agreed to ­reduce the cap for accountants to 4.5 per cent, the Assistant Minister for Immigration, Michaelia Cash, said the government had decided to reduce the cap further to 3 per cent.

Senator Cash said the new ­occupational ceiling would limit the number of accountancy places to about 5000 next financial year.

“Lowering this ceiling will not only ensure that the allocation of the program remains appropriate to Australia’s … needs, but will safeguard other in-demand occupations … from being crowded out from excessive ­accountant applications,’’ she said.

The government has backed the agency’s recommendation to keep dentists on the list and maintain the cap at 6 per cent, meaning up to 942 foreign dentists will be able to obtain permanent visas next financial year. About 15,700 dental practitioners are employed in Australia, with non-citizens making up 15.2 per cent compared with an 11 per cent average across all professional occupations.

According to the agency, there has been a 41 per cent growth in dental employment over the past five years, with employment growth expected to rise 20 per cent over the next five years.