Planning Update: Tax and Benefit Administration and the COVID-19 Pandemic in 2020–21
Each year, the Canada Revenue Agency (CRA) prepares a Corporate Business Plan (CBP) and Departmental Plan (DP). The Summary of the CBP and DP are tabled in Parliament and are important tools to inform Canadians of how the CRA intends to use its resources to fulfill its core responsibilities of administering tax and benefit programs. The CRA’s CBP and DP for fiscal year 2020–21 with perspectives to 2022–23 were developed prior to the COVID‑19 pandemic.
This planning update describes the impact of the COVID-19 pandemic on the CRA’s previously reported plans for fiscal year 2020–21. It provides the most current information available as of September 2020. As the pandemic continues, it may have additional impacts on the CRA’s plans.
The pandemic required the CRA to rapidly launch new programs to deliver on the Government of Canada’s Economic Response Plan. The CRA’s work in recent years to transform into a client-centric, digital organization positioned it well to respond to the pandemic and support Canadians in this difficult time. However, the magnitude of the effort and the need to adapt to the changing public health and economic circumstances have impacted our operations this year. Moreover, in an environment where cybercriminals and scammers continue to use more sophisticated means against the CRA and our clients, we will continue to adapt our practices to protect our clients’ personal information and build their trust in us.
Contextualizing our priorities
The CRA and its Board of Management remain committed to the following five priorities:
- Providing a seamless service experience
- Maintaining fairness in Canada’s tax and benefits administration
- Strengthening trust, transparency and accountability
- Enabling innovation
- Empowering our people to excel
These priorities will continue to guide the delivery of the CRA’s core responsibilities. They have proven to be essential to the CRA’s operations during the pandemic and responding to the evolving needs of Canadians. As the CRA continues to deliver emergency measures, it has placed service and empathy at the forefront in all of its interactions, while continuing to provide accurate information and promote compliance to ensure the tax and benefits administration remains fair for all Canadians.
We recognize maintaining this fairness, particularly in the administration of emergency measures, is fundamental to Canadians’ trust in us. Despite the CRA’s actions to combat scams, identity theft happens every year, and cyber incidents are a regular occurrence. Scammers acquire taxpayers’ personal information through a variety of means, such as phishing scams and data leaks or breaches stemming from organizations outside the CRA. As scammers adapt their practices, so does the CRA. We routinely monitor accounts for suspicious activity to detect, prevent and address potential instances of fraud and identity theft, whether or not this activity is related to cyberattacks. The CRA works to quickly notify individuals whose accounts may have been compromised and offers credit protection services free of charge to help prevent fraudulent activity. Additionally, we will continue to work diligently to identify threats to the security of information and improve cyber security, to prevent and detect fraud and the misuse of information.
Finally, the CRA is ensuring that the workplace—whether at home or in office—is healthy and safe, and employees have the tools and support they need to continue to deliver emergency measures and provide service to Canadians.
A primary focus of the CRA this year will be to ensure that the new and essential COVID‑19 emergency measures are effectively implemented and managed to support Canadians and businesses facing hardship as a result of the pandemic. The COVID‑19 pandemic has impacted the 2020 tax filing season and is expected to affect the CRA’s overall performance and delivery of commitments to Canadians outlined in corporate plans for 2020–21, with potential impacts in 2021–22 as well. We will provide a full account of these impacts in future departmental results reports. The CRA will also continue to track and report online on the delivery of emergency measures.
Administering emergency measures in response to the COVID‑19 pandemic
The COVID‑19 pandemic has had an unprecedented impact on the lives of Canadians. The CRA’s vision of being trusted, fair and helpful by putting people first has guided our actions to support clients during this pandemic. As part of Canada’s COVID‑19 Economic Response Plan, the CRA took action to help clients facing hardship, while ensuring that any privacy implications were reviewed, mitigated, and addressed when required. A complete catalogue of changes to CRA services, due dates and programs affected by the pandemic is available on the CRA and COVID-19 web page.
In response to the pandemic, the CRA is administering the following emergency measures:
- the Canada emergency response benefit (CERB), to provide income support for people facing unemployment, who are sick, quarantined, or in directed self-isolation
- the Canada emergency student benefit (CESB), to provide funding for post-secondary students and graduating high school students who do not qualify for the CERB
- the Canada emergency wage subsidy (CEWS), to support employers and protect jobs
- a one-time special payment through the goods and services/harmonized sales tax (GST/HST) credit, to provide additional income support for low income individuals
- the temporary wage subsidy (TWS), to support eligible employers by reducing the amount of payroll deductions required to be remitted to the CRA
- a one-time payment increase of an extra $300 for each child, under the Canada child benefit (CCB), to deliver additional support for families with children already receiving the CCB
- support to the provinces and territories by providing assistance to deliver additional tax credits or benefits
To add integrity to the administration of the CERB and CESB and to guard against instances in which individuals may be defrauded, the CRA increased its requirements for applications. This will help the CRA complete applications securely.
The CRA is also providing flexibilities to help clients through the pandemic, including:
- extension of certain filing and payment deadlines that may pose unnecessary strain on individuals, businesses, trusts and charities
- continuation of benefit payments, such as GST/HST credit and CCB, until September 2020 for those who are unable to file their tax return on time
- temporary waiver of interest on existing tax debts related to individual, corporate, and trust income tax returns to ensure existing tax debt does not continue to grow through interest charges during this difficult time
- focus on higher dollar audits first, audits close to completion and prioritizing actions that are beneficial to the taxpayer or where taxpayers have indicated there is an urgency to advancing their audit
- deferral of other CRA actions that might pose a burden on clients, including suspending collections activities on all debts, except for high‑risk cases
- temporary administrative policies to reduce or eliminate unintended tax effects of COVID‑19 travel restrictions on individuals and corporations
- alleviation of cash flow pressures on businesses, including processing scientific research and experimental development tax credits and issuing payments
- flexibility in the use of communication methods where an interaction with the taxpayer has already been initiated for audit and complex special election returns processes
The CRA is continuing to offer tax and benefits administration services while adjusting to respect public health advice where required. This includes:
- adapting the Outreach Program and Liaison Officer Program, traditionally available in person, to be accessible over the phone to provide urgently needed information for clients, including small businesses and self-employed individuals
- supporting free virtual tax clinics hosted by community organizations, by videoconference or phone, through the Community Volunteer Income Tax Program (CVITP) and the Income Tax Assistance – Volunteer Program in Quebec
- implementing the new Individual Tax Filing Assistant Project to help certain clients file their tax returns, such as clients eligible for the CVITP
- accepting electronic signatures on forms to authorize a representative to file income tax returns electronically on behalf of individuals or corporations, to meet the evolving expectations of taxpayers and electronic filers and to reduce administrative burden
- continuing to deliver critical services, such as processing requests by clients that result in issuing refunds or tax credits or benefits, adjustments and clearance certificates
The CRA will continue to engage stakeholders to ensure its approach remains world-class and communicate clearly as the pandemic evolves. Specifically, we will:
- work with international partners, such as the Forum on Tax Administration (FTA), to share guidance and best practices on tax administration responses to the COVID‑19 pandemic, including the implementation of fiscal measures, and ensuring business continuity
- engage provincial and territorial tax administrations to keep them informed and, where appropriate, coordinate activities
- communicate regularly with members of the tax community, including industry associations, to provide updates and clarity regarding measures being taken to help clients
Ensuring the continuity of business and employees’ connectivity
In response to the COVID‑19 pandemic, the CRA implemented a national COVID‑19 Business Continuity Plan to ensure the delivery of critical services. During the initial phase of the plan, we implemented timely measures to ensure the connectivity of all employees. The actions the CRA has taken have been in collaboration with the unions. This relationship has been key in supporting workforce agility throughout the pandemic.
The CRA will continue to foster a thriving workforce by supporting employees, the majority of whom are now working remotely, through technology and processes, including:
- increasing secure remote access (SRA) infrastructure to enable more users to connect to the CRA network remotely, and providing more bandwidth for those connections
- providing equipment and changing paper processes to make them digital, to ensure the ability to work remotely
- reviewing and adapting various internal mechanisms, policies, guidelines, and procedures to ensure they are relevant and able to support the CRA’s response to the COVID‑19 pandemic
Resuming business during the COVID‑19 pandemic
The CRA’s plans for resuming business during 2020–21 will be strategic and incremental, taking into account employee safety and readiness, program readiness, compliance risks, public awareness and opinion, tax policy priorities, and our clients’ resilience. We will focus on the areas that are most important in terms of service, and address the most egregious cases of non-compliance.
Employees’ and clients’ health and safety are the CRA’s primary concern. In this regard, we have based our health protocols on guidance from the Public Health Agency of Canada and Health Canada, as well as local public health authorities. It is expected that most employees will work remotely for the foreseeable future. CRA buildings will continue to follow health guidelines so that CRA worksites can be kept safe for employees who have continued to work from or need to return to them. Similarly, the CRA has developed protocols and risk mitigation procedures for exceptional cases where in-person interaction with clients is needed.
The CRA will also continue to support employee psychological health through the use of the Employee Assistance Program and as guided by our well-being strategy.
Our business resumption is rooted in our core values and beliefs as an organization. The CRA’s vision of being trusted, fair and helpful by putting people first is at the core of our approach to resumption, especially with so many individuals and businesses still facing the impacts of the pandemic. This means supporting our clients facing hardship and assisting them to meet their tax obligations. Since spring 2020, we have progressively resumed compliance operations, and by the fall, we expect to have in place a more focused version of all of our compliance programs. Our audit efforts will be focused on the highest risk cases. It is important, now more than ever, that we prioritize an empathetic approach as we resume regular activities.
Clear, up to date, consistent and frequent communications on all decisions regarding business resumption will be essential. The CRA will use national, regional and local messages to communicate with employees and external stakeholders.
Seizing opportunities as we adapt
The need to adapt quickly and in some instances, assume the responsibility of delivering new programs, has demonstrated the resilience of the CRA and its employees. While the pandemic continues to be a challenge, it also provides the opportunity for innovation as the CRA resumes its business and adapts to the changing circumstances of a low-contact and physically-distant reality.
Our response to the pandemic allowed us to accelerate our digital transformation while maintaining clients’ privacy at the centre of our preoccupations. Our digital transformation is driven by our priorities to provide seamless service to Canadians; to strengthen trust, transparency and accountability in the CRA; and to enable innovative ideas and ways of working.
In 2020–21, the CRA will continue to accelerate its digital program to integrate modern technology and practices in the following areas:
- delivering high quality interactions across all channels and programs
- collaborating with clients, industry, and other government entities to drive shared innovation as well as improvement in tools, services and mindsets
- modernizing practices and approaches to enable greater organizational flexibility
- preparing the organization to realize the potential of digital transformation
The CRA has identified and enhanced measures to empower our people as they work. The CRA has sharpened its focus on enabling a workforce that will predominantly be working remotely. To this end, the CRA will continue to equip employees and explore technology and tools to help them be more effective in their role, while supporting their physical and psychological health and safety. We will also consider our traditional approach to the geographic scope of staffing exercises in light of the realities of working more remotely and the opportunity to employ a workforce that best meets the needs of our transformation.
Increased worldwide attention on systemic racism gives additional impetus to our ongoing eﬀorts to foster a workforce that represents Canada’s diversity, while continuously creating an environment where individuals are safe to be themselves. The CRA will enhance eﬀorts to eliminate systemic discrimination, and harassment.
Working remotely has the benefit of reducing greenhouse gas (GHG) emissions from employee commuting while restrictions to travel and the use of technology to participate virtually in meetings will reduce the GHG emission from business air travel. The increased digitization of paper processes is also expected to decrease our consumption of paper. These results align with the CRA Departmental Sustainable Development Strategy 2020 to 2023.
The pandemic has inspired us to intensify our transformation to a more people-centric organization. Although the pandemic may continue to require physical distancing, we must continue to keep people at the centre of how we deliver programs and services in this changing environment. It is ultimately people who have been impacted by the pandemic, and we will increase our efforts to be empathic as we deliver emergency measures alongside our tax and benefit programs.
The way forward
The CRA demonstrated its agility in responding to the pandemic. We mobilized people and allocated resources to key priorities and were open to accepting more risk in favour of faster delivery of projects. We will learn from this experience and challenge ourselves to apply this knowledge in different situations.
One of the lessons that we will take forward is the resilience of our priorities even during moments of great change and uncertainty. When the need arose for thousands of CRA employees to deliver new programs to Canadians, providing seamless service and sincere empathy emerged as the most important considerations. Maintaining fairness informed the CRA’s decision to be flexible in helping people affected by the pandemic. We continue to prioritize transparency and accountability to ensure that trust remains strong. We are delivering the programs identified in the GC Economic Response Plan by cultivating an environment that enables innovation and ultimately, empowers our people to excel.
The CRA will continue to conduct all of its activities with the utmost integrity. In 2020–21, we will carefully verify the eligibility of our clients for the new programs launched during the pandemic, focusing on compliance actions to address issues such as misuse and fraud. We will apply a respectful approach, even when investigating fraudulent claims for emergency benefits.
A key concern of Canadians is the constant threat of increasingly sophisticated cybersecurity threats. As noted in the CRA Privacy Management Framework, the CRA is committed to upholding the trust that Canadians place in our organization. To meet their expectations, the CRA is continuously enhancing its security controls, and managing a wide range of security risks in a fast-changing and sophisticated threat environment. We will continue to make investments in security to protect data, information assets, and information technology structure from these threats.
As stated in our Corporate Business Plan, innovation is the positive change that is required to adapt to current challenges and changing circumstances. Our organization’s innovative mindset has been essential to delivering the Government of Canada’s response to the pandemic. As we move forward with resuming our regular business, this mindset will continue to play an important role, as we consider how the lessons learned during the pandemic can drive innovation. It is, furthermore, the resiliency of our people and their ability to handle the shifts in focus that made managing the pandemic possible and will continue to be essential in managing the way forward. Our people are fundamental as we strive to be a world class tax and benefit administration that is trusted, fair and helpful by putting people first.
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