Public Accounts Committee on March 11th, 2026

[Charly Norris]

Yes, it's for a corporation. Individuals are different from a corporation.

Again, we look at their financial situation and financial statements. What are their assets? Are they still operating? If they're not operating anymore, what happened to the assets? We look at the bank accounts. Has there been any transfer of assets? This starts from the bottom. Then, when the collection officer can't find those assets and determines that the business is no longer operating, and we have done all our searches across the banks, everywhere we can go.... We have lots of powers to look into the bank accounts and into other assets, third parties, accounts receivable, etc. Once we close all those doors and there's nothing left to do, then we determine that the account is unrecoverable.

At that point, it would go through many layers of approval before an account over $1 million ends up at the commissioner level for approval. It's not just one person making that determination; there are lots of people looking over that account.

[Ned Kuruc, Conservative, Hamilton East—Stoney Creek, ON]

Thank you for your answer, sir.

I'd like to cede my time, but I will say—

[The Vice-Chair, Liberal, Jean Yip]

There are 17 seconds left.

[Ned Kuruc, Conservative, Hamilton East—Stoney Creek, ON]

I apologize. I'm good. Thank you.

[The Vice-Chair, Liberal, Jean Yip]

We have Ms. Tesser Derksen for five minutes.

[Kristina Tesser Derksen, Liberal, Milton East—Halton Hills South, ON]

Thank you, Madam Chair.

My colleagues have been very thorough in their questioning, so a lot of what I wanted to talk about has been touched on already. I do have a few remaining questions, but I'd be happy to give a minute to Mr. Chambers, if he would like.

Do you want to take it?

[Adam Chambers, Conservative, Simcoe North, ON]

That's very kind. I appreciate it.

Look at this collaboration—although I don't think I'll be crossing the floor, just to be clear. I know there may be some precedent for sharing time and floor-crossing.

I have two quick questions for our analysts.

In your research, did you come across whether this bill would need royal recommendation?

[Dillan Theckedath, Committee Researcher]

With respect, unfortunately, we didn't look into the mechanics of that.

At a very simple level, if a new product is created—a new requirement that has administrative responsibilities in addition to what is currently in place—it would stand to reason that some additional resources might be needed in order for that to function.

I would also like to say that, on the other hand, the Government of Canada currently, as it exists, does have infrastructure. It has IT resources and IT professionals. It has server space, cloud space and stuff like that. This is my opinion, but at some level, it's a marginal increase in resource allocation. It is not zero, but it would not necessarily be too comprehensive, I would imagine.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you very much.

My final question is on this notion that there may be some corporations listed that may have debts owing that have been waived, forgiven or written off. In your opinion, since you've read the bill, would it not be possible, as the bill is currently drafted, to include the reason the debt was forgiven? For example, can we state the corporation and the amount, and whether the debt was waived, forgiven or written off, in order to identify the classification of debt being disposed of?

Is that not a possible interpretation of the bill?

[John Daley]

I can start, and I can pass it to my colleagues.

I do agree. CRA has the right person at the table to answer that question. We don't collect this information, essentially. I think CRA would probably have the largest amount of work to do to decipher corporation versus non-corporation debt-related writeoffs.

I'll pass the question to CRA.

[Jennifer Boudens]

Thank you very much.

With respect to the classification of writeoffs versus forgiveness or waivers, that information is already in the public accounts. The writeoffs under the FAA and the Bankruptcy and Insolvency Act are disclosed at the aggregate level. The other information, on forgiveness and waivers, is combined under the Income Tax Act or the Excise Tax Act, as appropriate.

I would have to consult with my colleagues who are the experts in those areas on the segregation of that data, unfortunately.

[Adam Chambers, Conservative, Simcoe North, ON]

That's okay. As long as you think it's possible....

Thank you very much.

[Isabelle Brault]

I'd like to add something.

In the case of a waiver, some work would be required on behalf of the agency.

As the case progresses, penalties may be applied, particularly at the time of filing. If a return is filed late, interest and penalties can increase. A little later in the processing of the case, the minister may decide, at his discretion, to waive those penalties and interest. Following the audit, additional penalties may be imposed. Then, at the appeal stage, for example, if the taxpayer files an objection, the minister can still, at his discretion, choose whether to uphold those penalties. When the case goes to court, the judge can order a different amount for penalties and interest.

As for creating a registry, for each taxpayer, the amount will change over time, and the process can take several years. To create an up-to-date registry, the amount will have to be adjusted on a taxpayer-by-taxpayer basis in addition to providing the rationale. This is theoretically possible, but it's not a static process, and it shouldn't be done only once for a taxpayer. In some cases, a number of decisions will be made as the case progresses.

[Adam Chambers, Conservative, Simcoe North, ON]

Thank you very much.

I'll yield my time. I'll just say that the intention of the bill was actually to capture every single writeoff. It doesn't matter if it was for a debt owing or for forgiveness of a loan. The intention of the bill was to capture corporations that have their debts expunged.

[The Vice-Chair, Liberal, Jean Yip]

Ms. Tesser Derksen, go ahead for a short question, please.

[Kristina Tesser Derksen, Liberal, Milton East—Halton Hills South, ON]

I agree in principle with what my opposition colleague has on the table here. I do want to go back, though, to the original point that Mr. Chambers was making around the disclosure of that large writeoff.

Mr. Norris, maybe I'll direct this to you to start. Just so I understand, it's the disclosure of the actual amount that you're not able to give us. Is that correct?

[Charly Norris]

It's the disclosure of a single amount, yes.

[Kristina Tesser Derksen, Liberal, Milton East—Halton Hills South, ON]

Okay. The disclosure of the amount is not possible under the policy you're engaging.

Ms. Boudens, I'm going to refer to my colleague Monsieur Lemire's line of questioning. Monsieur Lemire asked you several questions about the number of accounts that would be affected by $5 million or different staged amounts. Am I to understand, based on your answers, that 37 accounts would be affected by a $5-million threshold?

[Jennifer Boudens]

Yes, that's correct. That's an average over the last seven years. I averaged the last seven fiscal years to come up with what we would see on a regular ongoing basis if we were to have a $5-million threshold, and that's 37 accounts.

[Kristina Tesser Derksen, Liberal, Milton East—Halton Hills South, ON]

I'm not trying to get you. We really appreciate the work you do. I'm just trying to flesh out the policy rationale for not disclosing the largest amount.

Theoretically, if I really wanted to figure out which ones those 37 accounts were.... I now know there are 37 accounts affected by a $5-million threshold across the country. You're disclosing some amounts. Do you see what I'm getting at? You won't disclose the largest amount, for fear that it's going to identify or violate some kind of privacy issues.

I'm trying to flesh out the logical basis for why we can understand some numbers from Ms. Boudens, but not the big number from Mr. Norris.

[The Vice-Chair, Liberal, Jean Yip]

Give a short answer. Thank you.

[Jennifer Boudens]

The very short answer is that in those 37 accounts, you would not know if one of them was $500 million and 10 of them were $5 million. There is no single amount that allows you to research and potentially identify the company.

[The Vice-Chair, Liberal, Jean Yip]

Thank you.

For our final round, we'll start off with Mr. Stevenson. I will follow the real chair's order and end with the government.

Mr. Stevenson, you have five minutes.

[William Stevenson, Conservative, Yellowhead, AB]

Thank you.

As a chartered professional accountant in public practice, I've personally filed thousands of tax returns over the last 26 years. I'm not sure who really wants to answer some of my questions, but I'll probably start with Mr. Daley.

Our tax system is fundamentally based on volunteer self-reporting. Canadians are expected to file accurately with the information. If they don't, even if it's small mistakes, they are faced with penalties and interest. They can dispute with CRA for a long period of time. If they didn't have the correct information based on what CRA put out there and they still have these problems, who actually pays penalties? Who's responsible for the penalties? Maybe that's a rhetorical question: It's the taxpayer.

When we look at this, from your perspective.... You alluded to it earlier in your opening statement, Mr. Daley, that the CRA is the main function for Finance to collect funds. Would you say that the main purpose of CRA is to be a collection agency, or is it to help taxpayers file their information correctly with proper information? Is CRA supposed to be educational and help the taxpayer, or is it really just to collect funds?

[John Daley]

I think that, with having CRA here, they are actually the best place to define the mandate of their organization.