Law to Force the CRA to Report on Unpaid Income Tax
Report on Unpaid Taxes
This proposed law wants to change how the Canada Revenue Agency (CRA) works. The CRA would have to regularly report on how much income tax is owed but hasn't been paid. This is called measuring the "tax gap." The report would show how much money the government is missing out on because people and companies aren't paying all their taxes. This affects everyone who pays income tax in Canada. It also affects businesses and organizations. By understanding the tax gap, the government can better target tax cheats. This could include people hiding money overseas to avoid paying taxes. This matters because it could make the tax system fairer. If everyone pays their fair share, the government has more money for important services. It also makes sure that honest taxpayers aren't unfairly burdened. Knowing the size of the tax gap can help the government create better rules to catch tax evaders.
Where this proposed law falls on the policy spectrums that Canadians care about
By improving tax collection through measurement of the tax gap and fighting international tax evasion, the bill could lead to increased government revenue, potentially enabling expanded government programs.
This proposed law aims to increase transparency around tax evasion and the 'tax gap' (unpaid taxes). It would require the Canada Revenue Agency (CRA) to report on tax evasion convictions and provide data to calculate the tax gap, which is good. However, the law leaves some details about how the tax gap will be calculated and used.
Things to Watch For
- The law doesn't specify how the CRA will find unreported income or audit tax returns.
- It's unclear how the CRA will use the tax gap data to improve tax collection.
- The law doesn't address potential privacy concerns related to sharing taxpayer data with the Parliamentary Budget Officer.
- The law does not specify the size segments for corporations.
- The law does not specify the frequency of reporting on tax evasion convictions.
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How likely this proposed law is to be approved
This proposed law was introduced by a senator, meaning it's less likely to pass than if the government proposed it. It's also still early in the process, having only passed the first reading.
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