Rita Trichur, writing in the Globe and Mail, has a great idea that I hope Conservative politicians will
pick up steal. If the government, she says, “is serious about putting people first, the solution is simple: Make the CRA do our taxes for us.“
“It’s not a stretch,” she says. “The CRA automatically receives information about the employment and investment income for most Canadians, so let its computers fill out the forms and do the math on our behalf for free … [and] … Numerous countries use such systems, so why not Canada? … [in fact, she says that] …Already 36 countries, including Britain, Germany, Japan and the Netherlands, allow return-free tax filing for some taxpayers, according to the Tax Policy Center’s briefing book.
As Ms Trichur points out there are companies out there that use Revenue Canada’s database of T4 slips and so on and offer (limited) free tax preparation. It seems to me that the proper Conservative position should be to partner with these private sector companies and pay them a bit to offer enhanced free service to Canadians rather than hiring additional civil servants.
What Rita Trichur proposes is a 90% solution. There are and always will be some Canadians who need or want well-paid, professional tax preparation and financial management services … and, good for them. There are some Canadians who fall through all the cracks in our social safety net; they are unknown to the government, have no reported income and don’t need to file tax returns. Of course, that might change if Canada had a negative income tax, as advocated by e.g. Milton Friedman in ‘Capitalism and Freedom,’ and some other economists from all across the political spectrum. Still, other Canadians don’t own a personal computer or smart-phone or live in remote areas where internet access is difficult, at best. But most Canadians live in suburbs and small cities and towns in Southern Canada and they, 90% of them Ms Trichur says, already use tax preparation software or tax preparation services and file their returns electronically. It would not be a big leap to provide almost all of them with free income tax preparation services,
Would it cost something?
Yes, of course … I don’t know how much. Rita Trichur says that “It’s also estimated that Canadians spend $7-billion complying with the personal income tax system each year, according to the Fraser Institute.” But, the fact that Britain, Germany, Japan, the Netherlands and Sweden do it suggests that it’s an affordable public service, especially if it doesn’t involve hiring thousands of additional civil servants.
This seems to me to be a simple, straightforward, affordable idea. I hope some CPC leadership candidates will think about it.