Too many people and businesses are cheating the tax system and getting away with it - Macleans.ca

Too many people and businesses are cheating the tax system and getting away with it

The AG says the CRA needs to do a better job

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The mishandled procurement of fighter jets wasn’t the only thing on Michael Ferguson’s mind Tuesday. Canada’s Auditor General also revealed a report saying people and businesses that don’t file or register taxes are getting away with it too easily. He concluded that the Canada Revenue Agency needs to do a better job monitoring and enforcing failed tax returns from individuals and corporations, and better ensure that businesses register to pay GST and HST.

“The Agency continues to struggle to develop measures that demonstrate its effectiveness in addressing filing or registration compliance,” Ferguson said, quoted by the National Post.

At issue is the CRA program that’s meant to identify which cases are worth pursuing. Ferguson said the program is too small— with $39 million of the agency’s $4.5 billion budget—to look into the thousands of non-filers and non-registrants identified by its automated system. His report did not identify the lost revenue this represents, but Ferguson emphasized that the system “needs improvement” so that workers can make sure the cases they choose to go after are the biggest ones.

Still, as the CBC reports, the 700 employees tasked with combing for tax cheaters have yielded impressive results. In the two fiscal years that Ferguson looked at, they uncovered $5.6 billion in additional taxes, penalties and interest. That’s $4 million per employee, per year.

Makes you wonder what they’re missing.

 

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