The FPA has called on Government to reconsider its proposed definitions for new categories of advice and advocated a rethink of personal and general advice.

Citing potential confusion for consumers and an increasing compliance burden for planners, the FPA asked that Government reconsider its proposal to establish a new category of 'product sellers' as distinct from financial advisers in its latest submission to Treasury.

"We have real concerns that the proposal to create a 'sales' category in its present form could substantially alter the structure of the regulatory regime and weaken the consumer protection under FSR," FPA chief executive Jo-Anne Bloch said.

"We are not confident that consumers will be able to differentiate between a sales recommendation and advice and realise that the responsibility in choosing a particular product will be almost entirely theirs."

The FPA also asked the government to raise the proposed materiality threshold of $10,000, arguing that most clients seeking advice will have more than the stated amount and a range of needs on which advice, many of which will include a super component.

"Separating out superannuation from both of the above proposals will severely restrict the provision of holistic advice, and it will create a dual and even more costly compliance regime," Bloch said.

The FPA's submission also questioned the breadth of the government's definition of personal advice, arguing that it may cause practical problems.

"Personal advice carries an obligation on the planner to meet disclosure requirements which can be expensive for the consumer," Bloch said.

"Consequently, as well as urging the reconsideration of Proposal 1.1, the FPA advocates a widening of the definition of 'general' advice and a narrowing of 'personal' advice."