RESEARCH PAPER: Assessing the Canada Revenue Agency: Evidence on Tax Auditors鈥 Incentives and Assessments
Authors:
Ken Klassen, University of 蓝莓视频, SAF (lead researcher)聽
Nick Pantaleo, Executive in Residence, SAF, University of 蓝莓视频
Abstract
Authors Kenneth Klassen (pictured) and Nick Pantaleo explore the pressure on the CRA to raise more tax revenues, as well as assess the efficiency of the audit process and the fairness of results.
Incentives to increase assessments were amplified by recent funding for the CRA that carries an expectation that additional tax revenues of $5 will be collected for each $1 spent, a 鈥渞eturn鈥 that is much higher than in the past. As well, these additional tax revenues are explicitly linked to closing the 鈥渢ax gap,鈥 the CRA鈥檚 measure of 聽how much tax revenue theoretically exists versus how much is actually paid voluntarily.
Practitioners express concerns over poor CRA audit-process quality. The duration of CRA audits, the very high proportion of reassessments that are issued in the final two months of its fiscal year, and the rate at which reassessments are eventually ruled in the taxpayer鈥檚 favour lend some evidence to these concerns.