There’s nothing quite like a taxing situation

Hey there, time traveller!
This article was published 05/09/2024 (752 days ago), so information in it may no longer be current.

Sometimes, the optics are the worst part.

And we understand: being the country’s tax collector is a thankless job.

It’s awfully easy, right now, to harbour a little dislike for the Canada Revenue Agency. For most of us, interactions with the CRA can be the height of frustration, while for big business, the optics look more like a meeting of friendly minds. More on that later.

First of all, wherever you stand in the CRA queue, please don’t take out your frustrations on whatever CRA employee finally picks up the phone and answers your tax-related call.

Canada Revenue Agency employees aren’t making a commission on the taxes they collect. Like casino employees, they’re happier when the customer is happy. Your Texas Hold’em dealer would rather you were winning at cards than losing — it makes for a happier table.

But, even with that, it’s easy to see why the players at the CRA table aren’t very happy right now.

Trying to reach a human on the phone is a litany of hours of excruciatingly bad “hold” music, dropped calls and Kafkaesque options: “You can ask for a reassessment and you’re eligible to file for a formal appeal, but if you ask for a reassessment, it won’t be completed before the appeal period expires, so you won’t be able to file for a formal appeal then.” So, the reassessment process is so slow, you have to forfeit your right to appeal? Yes. Sounds fair.

And once the process is rolling, well, let’s just say the ball does not roll very fast.

“Based on our initial screening, your objection has a low level of complexity. Our goal is to resolve low-complexity objections within 180 calendar days of the date they are sent to the CRA.”

The CRA admits it only meets that “goal” 62 per cent of the time.

If it takes six months to handle the easy ones, how long does a complicated objection take? Well, for a medium complexity issue, the CRA’s average is 311 days. Complicated ones? 690 days.

And all the while, the final determinations seem to be firmly in the CRA’s hands.

It’s hard not to feel like the littlest kid in the schoolyard, being shaken down for a tax on your lunch money.

Meanwhile, to add insult to financial injury, there’s the news Tuesday that 11 companies operating in Canada had $1.2 billion of tax debt and other repayments written off by the CRA in the last fiscal year.

And perhaps to put an even finer point on it, that five companies accounted for $1.02 billion of that CRA forgiveness.

Those figures were released by the federal minister responsible for the CRA in response to a written question by Conservative Senator David Wells. There are many reasons why the amounts may have been written off, including the fact that the companies involved may have gone bankrupt. (But if a company has gone into bankruptcy, how long, exactly, had it taken for that firm to reach $204 million in tax-related debt, which is the average amount of debt of the top five firms receiving the write-offs?)

What companies were they?

Well, the federal government says that information can’t be released for privacy reasons.

There are always going to be taxes that simply can’t be collected. In the last fiscal year, the CRA’s total writeoffs of uncollectable taxes was $4.9 billion.

When you get an email saying to look in your CRA My Account because “The Canada Revenue Agency (CRA) sent you new mail online called: Review letter. This mail may require your attention,” it’s hard to feel anything but unmitigated dread.

Chances are pretty darned good that it’s asking for more money, not writing off what you owe.