Experts say the government is failing to meet its 2023 budget promise to pilot a new automatic tax payment program this year.
Last year’s federal budget announced that the Canada Revenue Agency (CRA) would “pilot a new automated filing service” in 2024, giving hundreds of thousands of low-income and fixed-income Canadians taxpayer-only benefits. He said he would make the money available. Return value.
By law, in most cases, only those who owe taxes must file a return with the CRA each year.
Many people, especially those receiving government assistance, rarely apply because they don’t think they can owe anything to the federal government.
Under an automated system, the CRA itself would use data on personal income on hand to complete such simple filings each year, eliminating the bureaucratic burden that stands in the way of low- and fixed-income earners. You will need to create a document. are receiving benefits.
The CRA announced earlier this month that it would expand its existing telephone tax filing system, called SimpleFile, in exchange for piloting a new automated filing system.
Under this program, the CRA sends a written invitation to taxpayers to call and answer a series of questions in order to file a tax return. SimpleFile has been introduced since his 2018.
CRA said in a press release that it will launch digital and paper versions of its SimpleFile service this summer.
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However, in a separate statement to CBC News, the tax authority confirmed that the expanded SimpleFile program will continue to be invite-only.
Jennifer Robson, associate professor of political management at Carleton University, says this is not the same as an automated submission system.
“They were doing this very limited effort and this was kind of part of the promise.” [the budget]. It’s definitely not a full meal deal,” she said.
Robson said the problem is that both the digital and paper versions of the SimpleFile system still require taxpayers to initiate the process.
“This still requires that people… decide to take a proactive step based on the request from the tax authorities,” she said.
Kim Moody, a Calgary accountant and former president of the Canadian Tax Foundation, agreed. He said requiring taxpayers to initiate the process was a “fatal flaw”.
“What is the plan to put that money into the hands of not-so-good people? [with] Or are you afraid of taxation? ” Moody said.
“If you have a system designed for humans to be the initiator of the process, good luck.”
Many other countries, including the UK, Germany and New Zealand, have introduced some form of automated tax filing system for people on low or fixed incomes.
Moody said he thinks Canada should move toward the British model. Under this model, returns for people in simple tax situations are automatically filed, but inaccuracies can be corrected later.
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The CRA said it currently does not have all the information needed to introduce a system like the UK’s. The agency said in a media statement that the SimpleFile program simply asks taxpayers to verify their identity and answer a few additional questions to complete the process.
The agency said, “All SimpleFile services use information that the CRA has on file for individuals and the responses provided by the CRA to prepare and file tax returns.”
But Moody argues that the CRA should already have all the information needed for simple tax situations.
“What they have to do is create a system where people can automatically file their tax returns, automatically take the deductions they qualify for, and if there are any errors, they can correct them. It’s just a matter of managing it,” he said. .
“There are people throughout society like me who don’t have to pay expensive money to do everyday things.”
Robson estimates that roughly one-third of all Canadians have tax situations that are simple enough for the CRA to automatically file their returns.
“I think the question is, ‘What’s the default?’ And the current system is…if you don’t do anything, the tax office will say, ‘Even if we have all your information, we’re not ready to take this as your income statement,'” she said. . .
The CRA said it would hold future consultations to find ways to “further automate” the tax filing system.
“The CRA will continue to respect the needs of undeclared low-income Canadians by 2025 and beyond to ensure more individuals have access to benefits and credits designed to support them. We will chart a path forward,” the agency said in a media statement.
