Finance Committee on Dec. 12th, 2024

[Bob Hamilton]

Our normal collection processes would apply whether it's our employee or somebody else's. If they collected a benefit they weren't entitled to, it goes through our collections process and we get the money back.

I just want to clarify what we did, because that could have happened anyway through the normal thing. We looked to see who did it and investigated it, and as a result, terminated a number of employees. We had to go through a process because sometimes people can come in on a temporary basis, like students, so we looked at every case to make sure that it was inappropriate and they weren't eligible, and then we took action, but the collection was going to happen anyway.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Okay.

Do I have some time left?

[The Chair, Liberal, Peter Fonseca]

You have a few seconds.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

A few seconds. I think that's good.

Thank you for your time.

[The Chair, Liberal, Peter Fonseca]

Thank you, MP Morantz.

Now we'll go to MP Thompson, please.

[Joanne Thompson, Liberal, St. John's East, NL]

Thank you.

Commissioner, other than audits, what compliance measures would the CRA use to reduce the tax gap?

[Bob Hamilton]

Mr. Chair, audit is definitely one factor. However, we try to think about getting long-term compliance in place, and that can come in other forms.

One can be through education. We work with businesses and individuals to make sure they understand their tax liabilities, so they become more accustomed to paying their taxes and we get the tax we need out of that. There's a real education part to this that helps us.

The other is—and I guess it's partly education—having a liaison officer program. They will go out and work with newer small businesses, saying, “Okay, you're entering into this business, and this is the kind of thing we see typically causing tax problems.” Again, it's about having a conversation. It's not an audit. It's just awareness that these are the kinds of issues that...so you should watch out for them. Again, we don't have data to support it. Intuitively, though, we think we can get people into the groove of complying with the tax system if they understand it. Frankly, the tax system is complicated, and a lot of people don't know what problems could arise.

Yes, it's about audits. We try to publicize where we have enforcement actions just to make sure there's a deterrence factor there. However, there is a real education, and it's more on the benefit side—making sure people are aware of their tax obligations, and making it easier for them to get information so they do it right. It's about beefing up our website and having better information material.

Those would be things we focus on.

[Joanne Thompson, Liberal, St. John's East, NL]

Thank you.

I want to circle back for a second to the international group of, I think you said, five other partners

In those meetings, does the workaround you just spoke about—the efficiencies you put in place to reach out to businesses and individuals, and the service standards referenced earlier.... Here, I have to shout out to the local CRA office in my riding. They're very good to work with.

Regarding the work you're doing with these other partners, can you measure it or speak about what's happening in Canada versus what you're seeing across those other countries? Probably, the rate of tax owed has been written off, as well. Are there trends you're seeing that we align with—or don't?

[Bob Hamilton]

Mr. Chair, in a broad sense, yes.

What I get from my counterparts are a lot of the same issues we're dealing with. Some countries are in a better place and others are in a worse place, but generally we're dealing with the same issues, such as the debt. This is particularly for tax administrations. It's not to the same extent as Canada, but they were also involved in delivering benefits through the pandemic. Now everybody is dealing with fallout from that.

I would say that some of the partners I talk to are very interested in the issue. How do we get compliance? We often talk about “taxes just happening”. How do we make compliance by design, or build it into the system so compliance can be there? In extreme cases, a number of countries have automatic filing where they just fill out the tax form for the person. That's more in the individual space than corporate. Only if the person has a dispute would they have to do anything. Otherwise, they just sign it and that's it. It's a very streamlined process. Now, you need a simple tax system to do that. You can't do it in a complicated way.

Yes, all of the countries are trying to find ways of dealing better with people to make it easier for them to file—to make compliance a much easier process, rather than a confusing one.

Now, for businesses, it's the same thing. We have liaison programs. We try to educate businesses to make it easier. You get people who don't want to comply, even if you make it easy, so we have to make sure we have good enforcement to deal with those.

[The Chair, Liberal, Peter Fonseca]

You have a minute.

[Joanne Thompson, Liberal, St. John's East, NL]

With a minute left, is there anything you would like, in the final round, to say to us—something that didn't come up that you'd like us to know?

[Bob Hamilton]

I won't go on for too long. Don't worry.

I just want to return to an important issue that we talked about, which is fraud.

I just want to say that there are a number of things that we're doing within the agency. It's not perfect, but just like any other organization, we're dealing with some very creative and aggressive people.

In the agency, we have set up a separate branch on security that is dealing both proactively and reactively with trying to prevent and identify where there are fraud risks. From doing that, hopefully we can prevent it from happening. If it happens, then we take action right away and close down that vector to protect the accounts, make sure the individuals are protected and make sure that we protect the treasury as much as we can.

This is an agency-wide effort. We are very devoted to it. I can't say we're perfect, but the effort is there. Relative to other organizations I know of, I think we're doing a very good job, both proactively and reactively.

I don't think there's anything else I really wanted to add other than....

We talked about whistle-blowers. My goal is to make sure that if people see something going on in the agency that they don't like, they can feel free to raise it. As the minister said, we can't have people giving out taxpayer information. We have to be concerned about that. However, we do have mechanisms in place that, if someone sees something, they can go to their manager. We have an anonymous whistle-blower program within the agency. There's one that operates federal-government-wide. If that all fails, they should come to me and tell me.

I would note that in the very latest public sector survey, the agency scored quite well in terms of people feeling that they can bring their complaint forward without fear of reprisals [Inaudible—Editor]—

[Adam Chambers, Conservative, Simcoe North, ON]

I have a point of order.

[Bob Hamilton]

—which isn't total success, but I think it's a good sign—

[The Chair, Liberal, Peter Fonseca]

There's a point of order.

[Adam Chambers, Conservative, Simcoe North, ON]

Sorry, I apologize for cutting in.

I appreciate the commissioner's comments, but we're now short of time. I know you have a hard stop at 5:30. We've waited four months. I'm going to request that we be able to submit some questions in writing.

[The Chair, Liberal, Peter Fonseca]

That's not a point of order, MP Chambers.

[Adam Chambers, Conservative, Simcoe North, ON]

Listen, we're shortening the meeting unnecessarily when we have resources, so I'm going to request that we be able to submit some questions in writing to the officials, so that we can get answers back, which I think is a normal practice.

Is that fair?

[The Chair, Liberal, Peter Fonseca]

I'll ask the members.

[Some hon. members]

Agreed.

[The Chair, Liberal, Peter Fonseca]

Those will come to you in writing, Commissioner.

We do want to thank the commissioner, assistant commissioner, directors and all the officials who are with us here today, as well as the minister, who was with us for the first hour.

Thanks for coming before finance committee.

As you can see, members were very eager to ask many questions and you will also get some in writing through email.

On that, members, shall we adjourn?

[Some hon. members]

Agreed.

[The Chair, Liberal, Peter Fonseca]

We're adjourned.