CRA taking far too long to resolve tax objections, auditor general says

The federal auditor general says Canada’s tax man is costing the government and citizens millions by taking far too long to resolve income tax disputes.

Michael Ferguson’s audit says it took months for Canadians to hear from the Canada Revenue Agency after formally objecting to their income tax assessments, and that appeals officers can wait more than a year when they request help from other areas of the agency.

The audit says it takes the agency an average of 263 days to process an objection from an individual or corporation, and 1,503 days for so-called group cases that can include suspected tax evaders.

Auditors found that over the past 10 fiscal years, the inventory of outstanding cases grew by 171 per cent while the number of employees dedicated to resolving them grew by only 14 per cent.

The audit says the backlog of cases that were yet to be resolved as of March 31 represented more than $18 billion in federal taxes.

The report warns such delays can be costly in terms of time and money to the agency and to taxpayers, such as interest payments on disputed amounts paid to the winning side.

Auditors came to a similar conclusion when looking at how the federal government keeps a watchful eye on vehicle safety.

In a separate review of Transport Canada, auditors found the department sometimes waited years before implementing new safety standards, frequently making regulatory changes following decisions from its American counterpart.

In other cases, Transport Canada announced new standards with little data to support them — for example, the Liberal decision to make backup cameras mandatory on new cars. The audit cites department officials as saying there is “limited data and safety benefits” associated with the devices.

While auditors concluded Transport Canada did an adequate job of oversight on recalls and safety defects, delays in making decisions meant Canadians were not able to access new safety features that could keep them as safe as possible.

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