A new report from the Canada Revenue Agency finds that the federal government loses an average of up to $22 billion a year in unpaid taxes.
The agency analyzed tax collection from 2014 to 2018 for this first-ever report on “the overall tax gap” in Canada, released Tuesday. She estimates that the “net tax gap” for those five years, the amount of money that was owed to the federal government but not collected, totaled up to $111.2 billion.
Although the net amount of uncollected tax has tended to increase over this period, with estimates of up to 23.4 billion in 2018 and 23.5 billion in 2017, the ratio has remained stable each year. , to 9% of overall federal tax revenue.
According to the report, unpaid personal income tax was between $8.4 and $10.6 billion per year and unpaid corporate tax between $4.6 and $7.3 billion per year.
The CRA says compliance and collection activities over the five years covered by the report have recovered an additional $72.4 billion, money that otherwise would not have been paid to the federal tax authorities.
The Agency says that intentional tax evasion or excessive claiming of tax credits explain part of this “tax gap”, but that errors on the forms, ignorance and bankruptcy are also to blame.
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