Canada Revenue Agency Needs to Start Complying with its Own Rules: CRA SOTW

[Alan Baggett]

Canada Revenue Agency Needs to Start Complying with its Own Rules: CRA
SOTW

Canada Revenue Agency will spend $4.3 billion to collect taxes this
year, and businesses - which pay or collect on behalf of the
government more than half of the quarter-trillion dollars in federal
tax revenue - will spend $12.6 billion doing their bit to comply with
the rules.

For this hefty administrative over-head - it works out to more than
$500 per man, woman and child - I've long believed we get a third-rate
tax system. This is confirmed by an extensive new survey released by
the Canadian Federation of Independent Business as part of its third
annual red tape awareness week.

The survey, which updates one last done three years ago, indicates
that despite the appointment of a federal taxpayers' ombudsman, the
adoption of a Taxpayer Bill of Rights, and the launch of a new
complaint-settling process, not much has changed. The relationship
between CRA staff and their "partners" in business is still far too
frequently that of bully to victim.

In short, business people are still saying they feel intimidated and
treated like wrongdoers. As well, the survey of more than 10,000 small-
and medium-sized business owners and nearly 500 tax practitioners
countrywide found: . A large majority of business owners saw no change
in CRA service levels over the past three years, and the minority who
did detect a change were twice as likely to think it got worse than to
judge it as better. Tax practitioners were only half as likely to see
no change, but they were much more likely to think service has
deteriorated.

. Both owners and practitioners rated CRA poorly for accountability,
understanding small business, and using clear language. They were
somewhat more positive - hovering a bit over 50 per cent - in their
assessments of the agency's record of treating clients with respect. A
small majority of business owners thought CRA helps them comply with
their tax obligations, but 90-plus per cent of practitioners thought
it did not. (This may be connected to another finding - that 55 per
cent of practitioners and 25 per cent of owners reported getting wrong
or conflicting advice from CRA staff members.)

The biggest specific complaints were being kept on hold for long
periods, having to call multiple times to get through, being given
general answers to specific questions, and being transferred from
agent to agent. Owners also rated CRA poorly for both the clarity and
the speed of writ-ten responses, whereas practitioners were somewhat
more satisfied with the clarity but a good deal less so with the
speed.
Static or deteriorating service levels, wrong or conflicting answers
and unanswered phones may indicate a competence problem and/or a short-
age of manpower.

But poor accountability, lack of empathy and respect, chronic run-
arounds, and general unhelpfulness from people who are paid to help -
these issues more than hint at serious problems within the culture of
the CRA. These are things that could be - should be - addressed by the
three-year-old Taxpayer Bill of Rights and associated fairness
provisions, but the survey showed a widespread lack of knowledge about
these potential remedies among not only business owners, but also tax
professionals.

And it's not as if knowing their rights will always matter - in a
telling exercise conducted by CFIB just over a year ago, for example,
only half the CRA staff contacted in 85 test calls would give their
first names and ID numbers, as they are supposed to do.

So simply ensuring that CRA com-plies with its own rules would be a
step in the right direction. But CFIB has some sensible
recommendations that have the potential to, at long last, provide
better value for the huge cost of running the CRA and complying with
its diktats.

These include such things as better staff training, stronger service
standards, plain language reviews, monitoring and public reporting of
ser-vice levels, increased accountability, lower fees and more
streamlined audit procedures.

But by far the most important one, in my view, is for CRA to press
ahead with a plan to have CRA staff respond in writing - preferably
quickly and electronically - to taxpayer questions. And then - and
here's the real key - for CRA to honour this advice, even when its
wrong. In other words, for CRA to be responsible for its own screw-ups
and not dump the consequences on hapless taxpayers who've tried to
comply but have been led astray.

dc...@vancouversun.com Blog: vancouversun.com/economy
© Copyright (c) The Vancouver Sun

Read more: http://www.vancouversun.com/news/agency+needs+start+complying+with+rules/6006482/story.html#ixzz1jj7hRYhD


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