Tax simplification a low-cost way to boost economy, CGA-Canada tells federal Finance Committee
MONCTON--Tax simplification is not only desirable and beneficial, it's achievable, said the Certified General Accountants Association of Canada (CGA-Canada) during its pre-budget appearance before the House of Commons Standing Committee on Finance.
"Faced with a tight fiscal situation and the need to control spending, the federal government will need to look for efficiencies and revenue-neutral or low-cost initiatives, as it manages the economy," the association noted. "Taking concrete steps to address tax measures or policies that unnecessarily add complexity to the tax system is an obvious solution."
Commenting on the association's submission, CGA-Canada's President and CEO Anthony Ariganello said: "The benefits of tax simplification are crystal clear. A simpler tax system means higher compliance rates and lower compliance costs for taxpayers. It means less paperwork for business and lower administrative costs for government. And it means a stronger system with a more secure tax base and predictable revenue."
CGA-Canada recommends the federal government simplify Canada's tax legislation and tax regime by:
Tackling the backlog of unlegislated tax proposals by introducing a technical tax bill this fall.
Implementing a sunset provision for unlegislated tax proposals to bring greater clarity and certainty to tax legislation.
Avoiding further targeted personal income tax relief measures and examining the effectiveness of existing measures.
Keeping corporate tax rates low to facilitate compliance.
Strengthening enforcement efforts on existing tax rules instead of adding rules and regulations.
Increasing parliamentary scrutiny over federal tax expenditures to ensure they meet certain established principles such as simplicity, fairness and efficiency.
Considering the appointment of a panel of independent experts to review Canada's tax system and ensuring the Finance Committee is involved in the review process.
"Canada can't afford to fall behind its global neighbours and risk becoming a less attractive place to do business," Ariganello warned. "A simpler tax regime is key to a strong, competitive Canadian economy."
Denis St-Pierre, Chair of CGA-Canada's Tax and Fiscal Policy Advisory Group, appeared before the Finance Committee to make the recommendations on behalf of CGA-Canada.
Founded in 1908, the Certified General Accountants Association of Canada serves 75,000 Certified General Accountants and students in Canada and more than 90 countries. Respected accounting and financial management professionals, CGAs work in industry, finance, government and public practice.
CGA-Canada establishes the designation's certification requirements and professional standards, offers professional development, conducts research and advocacy, and represents CGAs nationally and internationally.