Canadians for Tax Fairness is concerned by today’s Auditor General’s Report which indicates that the total amount of uncollected taxes has risen to an all-time high of C$29 billion.
“That figure is larger than the total federal deficit,” says C4TF executive director, Dennis Howlett. “Important services are being cut, we have a deficit – yet the CRA has created an atmosphere where tax cheaters know they can get away with not paying their taxes.”
Howlett points out that the Auditor General gave the CRA an unsatisfactory rating for developing reliable techniques for analyzing collection efforts. For instance, the CRA seems to be applying the same efforts and quotas for collecting from small accounts as for larger files. “If money is tight, it makes sense to start with the ultra-rich who owe you millions and work your way down,” says Howlett. “Instead they go after the little guy with more vigour than in tracking down offshore accounts.”
C4TF has been calling on the CRA do an estimate of the Tax Gap - the difference between tax revenue the government ought to be able to collect and what is actually collected. Despite the fact that many OECD countries use such a formula to develop tax collection strategies, CRA Minister Gail Shea has refused to pursue that model.