Finance Committee on May 8th, 2006

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Thank you, Mr. Dorais and officials. We appreciate the information you're giving us today.

As I think all of us are aware, today we are talking about the estimates based on the 2005 Liberal budget. Of course there has been a new budget tabled by the new government just last week, and we will have you again, I am sure, to talk about estimates based on that budget.

But as I was looking at the estimates based on the Liberal's 2005 budget, at the briefing note at page 5, a number jumped out at me that I'm hoping you can explain. It refers to the spending of revenues received through the conduct of operations pursuant to section 60 of the Canada Revenue Agency Act. You have that reference.

On the figures before us, what happened is that there was a more than fourfold increase for this category of expenditure between 2005-06 and 2006-07, and that was of course quite an increase. I wonder if you could let us know what that's all about.

[Michel Dorais]

This is a good question, Mr. Chairman. The member is very observant.

The agency has the ability to receive payments for service. This relates very specifically to the Canada Border Services Agency. As you know, they left the Canada Customs and Revenue Agency at that time. The first year after they left, the services were left on our estimates, and then in the second year we charged them for that, because we provide all the computer services for the border agency. So this is the cost of maintaining their computers, which is transferred from them to us. That's what appears in that line.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

That's a new operation for you?

[Michel Dorais]

It's not a new operation, except that it was on our base before and now it's being paid to us. So it's an accounting change.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

You mentioned to us in your remarks that you process more than 24 million individual and trust tax returns. I'm just kind of curious. How many individual taxpayers are there in Canada right now? Real people instead of trusts.

[Michel Dorais]

Barbara, do you know?

[Barbara Slater, Assistant Commissioner, Assessment and Benefit Services Branch, Canada Revenue Agency]

The vast majority of those are individuals. In fact, this year we're predicting about 25 million such returns. I don't have the exact figure, but the big number is the individuals in there.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

Why is there an increase in the number of individuals paying tax?

[Barbara Slater]

Well, the population grows every year, and therefore the number of people who become eligible to pay taxes increases with the population growth, largely.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

You mentioned that you received 22 million public inquiries over the phone. I'm not targeting your agency, because I don't know, but I do know as an MP that I get lots of complaints where constituents phone government numbers, not your agency necessarily, and then they either get this long instruction--press 16 if you want this and 22 if you want something else--or else they're put on hold for a long time. Can you tell me honestly just what kind of response people get if they phone your agency on that line?

[Michel Dorais]

We're pretty proud, frankly, Mr. Chairman, of our record on this.

On general inquiries, the average in the year is an 83% response rate, which is above private sector standards, and for business inquiries it's 91%. Hopefully people don't have to wait. In the peak period, in the weeks that just preceded today, there are times during the day when the waiting time can be longer, obviously, because we're peaking sometimes at 35 calls per second, as I said. We cannot answer 35 calls per second, so during those peak times people could be waiting. But generally speaking, the standard wait is two minutes in our call centres.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

I had better tell my local cable company how you do that.

You mentioned that as of May 4 you'd received almost 21 million tax returns, and that it was up about half a million from this time last year--actually, above half a million. I wonder to what you attribute the more timely submission of tax returns. Why is it up? Does it go up and down, or is it moving up steadily, or is this a one-time increase? What's happening here?

[Barbara Slater]

I think again it's just a reflection of the total increase. Our year-over-year increase is in about the 2% to 3% range due to increased population and increased tax-age filers. So that just reflects that we're tracking so far this year in about the same measure as we would expect to finish the year. It's not necessarily that people filed particularly earlier, because most people do file by the due date. That represents over 80% of the people we expect to ever file. And you may be aware that self-employed people and their spouses have a due date of June 15. So the gap of some of the people having not yet filed would be people who are eligible to have that deadline instead.

[Diane Ablonczy, Conservative, Calgary Nose Hill, AB]

That helps. Thank you.

[The Chair, Conservative, Brian Pallister]

Thanks, Madam Ablonczy.

Just as a point of clarification, you alluded to 25 millions Canadians who file tax returns, or 25 million taxpaying Canadians? I'd like to be clear on that.

[Barbara Slater]

We're forecasting 25.1 million tax filers this year. Again, the vast majority of Canadians voluntarily comply with their tax filing. About 75% are getting refunds, so they have some encouragement to file as well.

[The Chair, Conservative, Brian Pallister]

Mr. McKay, second round for five minutes.

[John McKay, Liberal, Scarborough—Guildwood, ON]

Can you tell me what the gross revenues of the Government of Canada are on the GST file?

[Michel Dorais]

We have that number somewhere; I just don't want to quote it by heart.

[The Chair, Conservative, Brian Pallister]

Do you have another question while they're digging it up?

[John McKay, Liberal, Scarborough—Guildwood, ON]

No, everything flows from that, so let's find out what the number is.

[The Chair, Conservative, Brian Pallister]

We've paused his clock at this point.

[John McKay, Liberal, Scarborough—Guildwood, ON]

If you're going to do that as a general proposition, I could come back over and over again.

[Brian McCauley]

For 2004-05, we have gross GST revenues of $67.6 billion on our records.

[John McKay, Liberal, Scarborough—Guildwood, ON]

So $68 billion for easy figuring.

What are the costs and credits of running the system?