Section 3 – Introduction to the Canada Revenue Agency (CRA)

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Agency Overview

Mandate - Contributing to Canadians' Economic and Social Well-being

The Canada Revenue Agency (CRA)'s mandate is to: administer tax, benefits, and related programs, and to ensure compliance on behalf of governments across Canada, thereby contributing to the ongoing economic and social well-being of Canadians. In real terms, this means the Agency is responsible for the administration of the Income Tax Act, the Excise Tax Act, and legislation relating to the Canada Pension Plan, Employment Insurance, softwood lumber, and tobacco. The Agency also administers a number of social benefit and tax credit programs on behalf of the federal, provincial, territorial, and First Nations governments. The work of the Agency helps protect Canada's tax base and supports the delivery of a number of important government programs, which are essential to the economic and social well-being of Canadians.

CRA by the Numbers - 2014-2015

$469B – Taxes and duties processed

$255B – Collected through source deductions

$52B – In outstanding tax debt resolved

$22B – Benefits paid

$21.9B – Non-compliance identified

28M – Individual income tax returns processed

23M – Telephone enquiries answered

Organizational Priorities

Amid increasing technological and social change, the Agency focuses on five strategic priorities to successfully and effectively deliver upon its mandate:

• Service:  The Agency provides multiple service channels to respond to a wide range of client service needs and is working to reduce red tape to improve the service experience of taxpayers and benefit recipients.
• Compliance:  The Agency addresses serious and deliberate non‐compliance with timely and targeted compliance enforcement actions. The CRA is increasing its use of advanced analytics and graduated compliance interventions to resolve non-compliance issues.
• Integrity and Security:  Canadians count on the CRA to protect their information and to carry out its duties with the highest level of integrity and security. The Agency seeks to quickly detect breaches of integrity and security, and take swift and firm action to resolve them.
• Innovation:  Innovation is fundamental to the CRA's ability to improve service to Canadians and to take firm and effective action on compliance. The Agency is creating an environment where new and innovative ideas are encouraged and supported. 
• People: The Agency manages its workforce through strategic recruitment, ongoing employee development, and effective succession planning strategies, to provide the expertise, leadership, and experience needed to deliver our strategic priorities.

Governance

Administrative Authorities

The Canada Revenue Agency Act (the CRA Act) sets out the mandate, structure and authorities of the CRA. It also establishes a governance structure for the Agency that is unique in Canada, comprising a Minister, a Board of Management (the Board), and a Commissioner.

Under The CRA Act (s. 30), the CRA has authority over matters relating to general administrative policy in the Agency, the organization of the Agency, real property, personnel management and internal audit. In these areas, the CRA has administrative flexibility, and is not subject to the same Treasury Board Secretariat (TBS) authorities as other government departments. However, TBS policies do provide a foundation for many of the Agency's policies.

The CRA has the authority to enter into contracts, agreements, or other arrangements with governments and public or private organizations and agencies. Contracting limits are based upon the CRA's own delegation framework, budgets, and resources, rather than those set by central agencies.

Unlike government departments that are subject to the procurement authority of Public Works and Government Services Canada (PWGSC), the CRA procures its own goods and services (except for legal services, which are provided by the Department of Justice). The Auditor General acts as an external auditor for the CRA.

The Minister of National Revenue

The Minister is responsible to Parliament for all CRA activities and exercises powers relating to regulation-making and providing reports to Parliament or the Governor in Council (Cabinet). It is a longstanding practice that the Minister does not direct officials how to interpret the law in individual cases. This practice preserves the Minister's right to be informed while at the same time protecting the Minister from allegations of political interference in taxpayers' affairs.

The Board of Management

Top Row: Gerard J. Fitzpatrick, Rossana Buonpensiere, Richard J. Daw, Susan Hayes, Mark S. Dwor (appointed after the 2014‐2015 fiscal year), Myles Bourke, Joyce Sumara, Norman G. Halldorson
Bottom Row: Margaret Melhorn, Andrew Treusch, Richard (Rick) Thorpe, Robert (Bob) M. Manning, Fauzia Lalani
Missing: Francine Martel‐Vaillancourt and Todd J. McCarthy (appointed after the 2014‐2015 fiscal year)

The Board of Management (the Board) is responsible for overseeing the organization and administration of the Agency and the management of its resources, services, property, personnel and contracts. It is also responsible for the development of the Corporate Business Plan. The Board is accountable to Parliament through the Minister and may advise the Minister on matters relating to the general administration and enforcement of legislation. The Board is not involved in the day-to-day management of the Agency and has no access to confidential taxpayer information.

The Board is comprised of 15 members appointed by the Governor in Council to serve "at pleasure": the Chair; the Commissioner; 11 Directors nominated by the provinces/territories; and two Directors nominated by the federal government. A Director's term on the Board can be up to three years and is renewable twice. The Chair's term can be up to five years and is renewable once.

The Commissioner of Revenue and Chief Executive Officer

The Agency is headed by a Commissioner who is appointed by the Prime Minister and has Deputy Minister status. The Commissioner is accountable to the Minister and must assist and advise him or her with respect to legislated authorities, duties, functions, and Cabinet responsibilities. As the CRA's chief executive officer, the Commissioner is responsible for the day-to-day management of the Agency. The Commissioner is also an ex-officio member of the Board and is accountable to it for the daily administration of the Agency, the supervision of its employees, and the implementation of management policies. The Commissioner must inform, as well as consult with, any department/agency and province/territory on whose behalf programs are administered by the Agency.

The Deputy Commissioner

The Commissioner is supported by a Deputy Commissioner. The Deputy Commissioner is appointed by the Prime Minister and is responsible for exercising the powers and performing the duties and functions the Commissioner assigns and must act for the Commissioner in case of absence, incapacity or vacancy. The Deputy Commissioner is not formally a member of the Board.

The Taxpayers' Ombudsman

The Taxpayers' Ombudsman has a direct reporting relationship to the Minister and maintains an operational independence from the CRA. The mandate of the Ombudsman is to improve service to taxpayers by offering a service complaint mechanism that is independent of the CRA. The Ombudsman is responsible for upholding the Taxpayer Bill of Rights, which sets out the Agency's public commitment to service values and 16 taxpayer rights that are derived from the Income Tax Act and the Excise Tax Act as well as the CRA's service commitments.

Organizational Structure

The Canada Revenue Agency

The CRA is comprised of 12 headquarters branches and five regional administrations (regions). Five of the headquarters branches are program branches, which provide policy and technical support for program delivery through the CRA's tax service offices and regional tax centres. The remaining seven branches are corporate support branches, which provide corporate support services such as finance and human resource management. The CRA separates the responsibilities for the establishment of program policies and procedures from field operations through the use of a regional structure. Each of the CRA's five regions is led by a Regional Assistant Commissioner who is accountable for program delivery in their region. This approach allows for a high level of program integration and ensures CRA program delivery is responsive to regional needs.

Operations

The CRA has over 42,000 employees; approximately 10,000 in headquarters and 32,000 in the regions. Agency programs are delivered through 51 local tax services offices and regional tax centres located in every region of the country.

Tax services offices deliver excise (GST/HST) and income tax programs through fully integrated offices that usually provide all aspects of our program delivery such as; audit, collections, payroll compliance, and appeals. Workloads handled in the TSO are typically low volume, high complexity files that may require a degree of face-to-face interaction or in-depth review.

Regional tax centres are primarily tasked with processing individual and corporate income tax, GST, other returns and payments, and delivering benefit programs. The regional tax centres usually deal with high volume, low complexity files that require little or no face-to-face interaction with taxpayers.

Provincial Tax and Benefit Administration

In addition to delivering federal tax and benefit programs, the Agency administers:

• Individual income tax for all provinces except Quebec;
• Corporate income tax for all provinces except Quebec and Alberta;
• Harmonized sales tax (HST) in Ontario and the four Atlantic provinces; and
• Sales and income tax for First Nations governments.

The CRA's administration of provincial corporate and personal income taxes is governed by Tax Collection Agreements, which are signed by federal and provincial finance ministers. HST administration is governed by Comprehensive Integrated Tax Coordination Agreements, also signed by finance ministers. The basic administration of provincial tax and related benefit programs is free of charge. However, provinces may request enhanced services from the CRA (e.g. increased verification of tax credit claims) on a cost recovery basis.

The CRA administers 135 benefit and credit programs and services on behalf of the provinces and territories and the federal government. The CRA's expertise and national systems lower the costs of administering programs and reduce the need for separate calculation and delivery systems at the federal and provincial or territorial levels. In 2014-2015 the CRA issued 115 million federal and provincial benefit and credit payments worth close to $22 billion to over 12 million  Canadians.

CRA's Provincial and Territorial (PT) Administration – 2014-2015

Individual and trust income tax – $62.2B
Corporate income tax – $15.9B
Harmonized sales tax – $23.5B
Total PT revenues administered – $100B
PT benefit programs and sales tax credits – $4.5B

As a holder of large amounts of information on Canadian citizens, the CRA is often seen as a key source for the sharing of information with other government entities. Conversely, the CRA acquires information from the provinces and territories to help improve the Agency's compliance programs. In support of these exchanges, the CRA completes written collaborative arrangements to ensure that the information it collects and shares is used appropriately, is adequately protected, and is supported by law. There are currently 164 such information sharing agreements in place with provincial partners.

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