The tax system is fundamental to a competitive environment, inclusive growth and a fair society. It affects people's daily lives and it urgently needs an overhaul. CPA Canada is calling for the first comprehensive tax review since 1967.
Canada's last thorough review of the tax system was concluded in 1967. Since then it has become bloated, complex and inefficient, having accumulated a patchwork of credits, incentives and narrow fixes. This dated, inefficient system is holding Canadians back.
Our society and economy have seen massive shifts that a 1967 tax system is simply not designed to cope with. The world has become much more global, technology has transformed the way we live our lives, people are living longer, and the nature of work has changed. Our two-page summary sets out why it's time for a fresh look at the tax system.
The current system is riddled with problems, is stressful and unnecessarily burdensome for Canadian taxpayers, businesses and tax professionals, as revealed in our report Canada's Tax System: What's so Wrong and Why it Matters. For our members, helping people navigate a complex tax system takes away from time better spent helping them grow their investments and plan for retirement, and helping small businesses to grow and create jobs.
Canada is behind. Many other countries have already undertaken comprehensive reforms of their tax systems, as detailed in our report International Trends in Tax Reform: Canada is Losing Ground. We need to ensure Canada is in step with theses shifts and prepared for the future, especially with the significant tax reforms in the United States.
In our report, The Best Way Forward: Designing a Tax Review for Canada, we lay out what a tax review should look like in Canada today. We explore the scope and the guiding principles of a tax system review. We look at the choice between a targeted review and a more comprehensive review. We set out the opportunities to make a difference by focusing on priority areas for a tax review.
Canadians want action to simplify Canada’s tax system, according to a Nanos Research public opinion survey on tax, commissioned by CPA Canada. Over 81 per cent of Canadians see a comprehensive tax review as a priority for the federal government, with more than one in three (35 per cent) saying it should be a high priority. Almost half (47 per cent) of Canadians say the tax system has become more complex than it was 10 years ago.
CPA Canada has long called for a comprehensive review of Canada's tax system. Our pre-budget advice and submissions to government have continually advanced the need for an evaluation of the tax rules and administration to:
CPA Canada has looked at experiences in Canada and around the world to develop research to help understand the current issues, and a way forward. Our reports look at:
