Need a technical tax fix? The time is ripe

With the backlog of tax technical amendments now history, the Department of Finance has the capacity to consider other tax laws that may need correcting or clarifying. Find out how you can get your technical issues on Finance’s radar.

Finance used to regularly propose large packages of technical tax legislation aimed at fixing both problems and unexpected results arising from the wording or operation of tax laws. But throughout the 2000s, a raft of these draft bills got stalled — causing considerable confusion and uncertainty for taxpayers. In 2013, the government passed an omnibus bill to clear the backlog.

TECHNICAL ISSUES A PRIORITY FOR JOINT TAX COMMITTEE

Now, the Joint Committee on Taxation of the Canadian Bar Association and Chartered Professional Accountants of Canada (CPA Canada) (Joint Tax Committee) has made identifying technical tax issues a priority. It will only, however, consider amendments that are strictly technical — that aim to make tax laws work as intended or to clarify ambiguous wording. The committee will not consider changes that affect tax policy.

The Joint Tax Committee has for decades been advising Finance on flaws in the tax law and how to fix them. In fact, the committee submitted its first recommendations to the government back in 1944, and has since become one of Finance’s most trusted advisers.

FRAMEWORK AGREEMENT PROVIDES NEW CHANNEL

Now, thanks to CPA Canada’s framework agreement with the Canada Revenue Agency (CRA) (see my earlier blog), the committee has a new channel to raise technical issues that may be solved through a CRA administrative mandate or a legislative amendment. The new CPA Canada-CRA Tax Administration Committee, formed in early 2015, meets regularly to identify areas of tax law that create unexpected or unintended tax compliance issues. Where an administrative solution isn’t possible, the new committee can bring these issues to Finance’s attention.

With Finance once again having the capacity to consider technical fixes — and the Joint Tax Committee’s relationships with both Finance and CRA — CPAs are in a better position to make the case for positive changes to Canada’s tax laws.

KEEP THE CONVERSATION GOING

I’d like to hear from you. What technical flaws in the tax law would you like to see fixed? Do you have an administrative or legislative solution? You can keep the conversation going by posting a comment below.

CPA Canada’s Tax Blog is designed to create an exchange of ideas on tax policy and practice issues, and their impact on those who practice tax. Your comments can provide helpful input into the public interest advocacy positions developed by CPA Canada.

About the Author

Gabe Hayos, FCPA, FCA, ICD.D

Vice-president, Taxation, CPA Canada

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