Canada Revenue Agency Departmental Performance Report 2013-14

Strategic Overview

The Canada Revenue Agency (CRA) is Canada’s tax and benefits administrator. Our activities provide the government revenue needed to deliver essential services to Canadians that lay the foundation for continued economic prosperity and future growth. In addition, we work in partnership with other levels of government such as the provinces and territories to collect revenues and deliver benefit programs on their behalf. Last year, we processed over $451 billion in payments and we issued almost $22 billion in benefit and credit payments. The work we do touches the lives of approximately 31 million individual and corporate taxpayers. The foundation of our administration rests upon three enduring pillars: service, compliance, and integrity.

Organization

The CRA employs a workforce of over 40,000 and maintains a physical presence in every major centre and region of the country. Although our employees work out of dozens of offices from coast to coast and perform a wide variety of tasks, they all share a common goal: to deliver unparalleled service and value to Canadians and our government clients. At the CRA, we are committed to delivering a world-class tax and benefit administration that is efficient, effective, and trusted.

In addition to the Income Tax Act and the Excise Tax Act, we administer legislation for the Canada Pension Plan, and the Employment Insurance Program. We are also responsible for enforcing legislation governing charities, collecting tobacco taxes and duties, ensuring registered pension plans comply with the regulations governing their administration, and collecting many non-tax debts for the federal government.

Outcomes, Technology, and Convergence

Our strategies focus on outcomes such as ensuring individuals and businesses find it simple and quick to comply, and most Canadians can deal with their tax matters online, when and how they choose. Our strategic approach is also propelled by rapid advances in information technology and data analytics. We continually expand our digital service offerings, and use advanced analytics to more accurately predict taxpayer behaviour and risk of non-compliance. We now use targeted, risk-based approaches that are more cost-effective and proactively support and influence the compliance behaviour of low-risk taxpayers. This reduces the need for costly audit and collections interventions.

As our use of technology and analytics becomes more sophisticated, new proactive compliance approaches are feasible. Service and compliance activities now often work together to make our program delivery more efficient. For example, our Liaison Officer Initiative supports compliance outcomes while helping businesses meet their tax obligations. Similarly, new digital services support compliance outcomes by enabling self-service and reducing the compliance burden.

Service, Compliance, Integrity, and Security

Our tax system works because Canadians have placed their trust in the fairness of Canada's tax system and the integrity of our administration and our people. We earn this trust by vigorously protecting the confidentiality of the information entrusted to us, providing fair and impartial redress, pursuing those who are non-compliant, and acting with integrity in our dealings with taxpayers, benefit recipients, and their representatives.

Service

Making it easier for taxpayers to understand and comply with their tax obligations is one of our core service priorities. This means providing easier access to clear, accurate information, providing timely services, and reducing the compliance burden wherever possible by reducing red tape. It means providing targeted assistance to taxpayers who may need a helping hand, like new Canadians, small businesses, students and seniors. It also means expanding the digital services we offer to give taxpayers and their representatives more opportunities to access our services and information.

We improved service by:

• enhancing our secure online portals—such as our new audit landing page—for taxpayers, benefit recipients, and their representatives.
• offering innovative new digital services such as expanded e-documents services, and developing CRA applications for mobile devices. 
• providing tailored help for those who need it, when they need it, such as first-time filers, new Canadians, seniors, scientific research and experimental development claimants, and small businesses owners.
• working in partnership with others to provide needed services—for example, working with community organizations to help deliver the Community Volunteer Income Tax Program—and exploring opportunities for new partnerships with tax preparers and software developers.
• reducing red tape for businesses so they can get on with the task of creating jobs and growing the economy.

Compliance

Delivering excellent service is just one important way we maintain high levels of voluntary compliance. With help and support, most Canadians comply with their tax obligations. However, there will always be those who will try to evade their responsibilities. Our compliance strategy is simple. We are increasing our support for those who need help to comply, and we are making non-compliance more risky and difficult for those who choose not to comply.

Our research tells us compliance depends on the perceived risk of detection for some taxpayers. The existence of a strong enforcement presence serves as an effective deterrent for many taxpayers who might otherwise be tempted to cheat.

We improved compliance by:

• creating point-of-sale audit teams comprising electronic commerce audit specialists to address the use of software that suppresses sales.
• improving compliance support to small business through our Liaison Officer Initiative, which provides information and in-person support at key points as businesses grow.
• using new proactive compliance efforts like letter writing and telephone campaigns to reach large numbers of taxpayers and positively influence their compliance behaviour.
• releasing pre-judgement information on significant criminal investigation actions such as searches, seizures, or laying criminal charges. This information helps to protect Canadians from fraud schemes.
• working more collaboratively with tax preparers to identify issues of concern and prevent common reporting errors. In February 2014, we  announced the Registration of Tax Preparers Program.
• implementing business intelligence and quality assurance initiatives in our audit and examination programs for income tax and GST/HST. This ensures the quality of our audits and brings greater rigour to our audit workload selection processes.
• supporting innovative measures, such as the new reward program for individuals who provide information on cases of significant international tax non-compliance.

Integrity and Security

Integrity is a cornerstone of our approach to administering tax and benefits and we are deeply committed to safeguarding the trust Canadians have placed in us. We recognize that our decisions and the conduct of our employees affect the lives of Canadians and influence their perceptions of Canada's tax system. Maintaining high ethical standards of conduct is a fundamental duty of everyone in our organization. Our Integrity Framework incorporates a strong system of checks and balances to make sure our employees adhere to those high standards.

We support our employees by promoting integrity and security in all aspects of our business and at all levels within the organization, from executives to front-line staff. Our Code of Ethics and Conduct and our Conflict of Interest Policy contain clear rules and standards of behaviour to which all employees must agree and adhere as a condition of their employment. Misconduct is addressed appropriately. We have established strong internal mechanisms to detect integrity and security breaches and to take disciplinary action against them.

We strengthened integrity and security by:

• advancing several multi-year projects enhancing our IT security, to better protect taxpayer data and prevent inappropriate access.
• implementing our Blueprint 2020 action plan, which included adding specific values and ethics clauses to executive performance agreements for 2014-2015, setting the tone at the top of our organization.
• introducing an enhanced security screening assessment for people holding or applying for positions requiring a high degree of public trust.
• establishing the position of chief privacy officer to monitor and oversee the management and protection of confidential, personal, and financial information at the CRA.
• acting quickly and decisively to temporarily shut down all CRA e-services to protect Canadians from the Heartbleed security risk.

Our future directions

We are proud to offer unparalleled service and value to Canadians and government. Our future is one where:

• compliance with tax laws is widely recognized as good citizenship.
• meeting one’s compliance obligations is made as simple and convenient as possible.
• most Canadians deal with their tax matters online, when and how they choose.
• staff are highly trained and have the resources to resolve most taxpayer problems and issues in real time.
• sophisticated analytics guide our service delivery strategies and help to detect and address non-compliance efficiently and effectively.

We know the work we do is essential to the social and economic well-being of Canadians. Our people are proud to work for an organization that is providing quality services and safeguarding the fairness and security of Canada's tax system. As we move forward, we will continue to improve the efficiency and effectiveness of our program delivery through service enhancements and new compliance initiatives. The CRA will always strive to provide Canadians with a world-class tax and benefits administration that is efficient, effective, and trusted.