A new report from the federal auditor general finds that the Canada Revenue Agency (CRA) has the required tools to combat aggressive tax planning, but it also recommends certain improvements.
In his spring report, which was tabled in Parliament Tuesday, Michael Ferguson examines a variety of different areas, including the CRA’s new Aggressive Tax Planning (ATP) program. It finds that the CRA program has the necessary tools to “detect, correct, and deter non-compliance”.
The auditor general’s report says that the agency has established a training plan for ATP auditors and has put in place performance measures to evaluate the program’s results. However, it also suggests that there is a need to complete the evaluation of the effectiveness of the agency’s national risk assessment model, as there are weaknesses in the ATP performance measures. And, it calls for improvements in monitoring the training of ATP staff.
The report indicates that the CRA has agreed with its recommendations, and has responded. “The CRA has accepted and is acting on all of the audit recommendations to improve administrative aspects of the Aggressive Tax Planning program which will further strengthen its capacity,” said Minister of National Revenue, Kerry-Lynne Findlay, in a statement responding to the report.
“While taxpayers are entitled to manage their tax affairs to reduce or eliminate the amount of tax owing within the objectives, and spirit of the Income Tax Act, the CRA will continue to challenge abusive schemes that are designed to avoid reporting or paying tax on income. Today, the Auditor General confirmed that the Agency has the tools to get the job done and is using them effectively,” she added.
Among other things, the report also finds that while Statistics Canada does ensure the quality of the statistical data it produces, improvements are needed here too. “In order to ensure the continued relevance of its data products, Statistics Canada should obtain, document, and analyze ongoing feedback from the full range of its data users,” it says, citing a particular need to meet the data requirements of smaller areas.
The report says that Statistics Canada agrees with its recommendations as well, and that it is also implementing changes as a result.