Promoting compliance

Total planned spending

(thousands of dollars)	Forecast spending 2011-2012	Planned spending 2012-2013	Planned spending 2013-2014	Planned spending 2014-2015
	197,738	191,169	186,045	185,829

The CRA's approach to ensuring Canada's tax laws are adhered to is to promote compliance by encouraging individuals and businesses to meet their tax obligations without our intervention. Transparent and fair application of the tax statutes, including a responsive redress system, maintains public trust and confidence in the CRA which in turn mitigates possible drivers of non-compliance.

We understand that protecting our public image will ensure that the CRA continues to be viewed as a trusted tax administrator, which is imperative when promoting compliance in a voluntary tax regime. We will enhance the CRA's management of the dispute resolution process, improve communication and resource allocation processes, and enable the CRA to better predict and absorb annual workload requirements.

The CRA builds and maintains the trust and confidence of Canadians through a number of activities designed to promote compliance and by treating personal information confidentially. To ensure that we continue to achieve these objectives, we will:

• conduct outreach activities targeted to specifically selected populations to inform them about their responsibilities and entitlements;
• provide objective and timely reviews of the CRA's redress and dispute resolution process; and
• encourage taxpayers to voluntarily come forward, using the Voluntary Disclosures Program, to correct previous omissions in their dealings with the CRA.

Communicating with Canadians

We will use traditional communication tools and emerging technologies to support CRA programs, deliver key messages, and provide clear, concise information about compliance issues.

Outreach program

The CRA uses outreach programs to connect with Canadians and deliver the information and assistance taxpayers and benefit recipients require. We use tools such as public opinion research, demographic analysis, environmental scans, and compliance risk analysis to identify taxpayer segments that could most benefit from outreach (e.g youth, new Canadians, small businesses, employers) and topics on which to focus our efforts. Technology enables us to reach wider audiences, including those who live in remote locations, efficiently and cost-effectively.

External communications

Our external communication and marketing activities raise public awareness about the importance of compliance and how interacting with the CRA electronically makes it easy to comply. The CRA is continually improving its electronic service offerings and communicating to ensure that Canadians are aware of the range of online services available.

Targeted communications are used as a compliance tool to sensitize potential non-compliant taxpayers about the consequences of tax cheating and highlight CRA programs and results that increase the likelihood of getting caught. Social media offers new ways to get this message to Canadians. For example, the CRA is expanding the use of social media to reach taxpayers, including Agency YouTube and Twitter channels.

The CRA is committed to making plain language the writing standard for external communications. We have undertaken various initiatives and activities to promote language quality in all our communications with Canadians.

Being fair

By listening to people's concerns, and acting in a fair and responsible manner, the CRA earns the respect and trust of those upon whom it relies to self-assess and pay the amounts owing.

Dispute resolution

The goal of the CRA is to provide objective and timely reviews of contested decisions through its appeals process and the mutual agreement procedure. The CRA's focus on aggressive tax planning over the last few years, and the successful identification of tax schemes, has resulted in an increase in the number of disputes filed with the CRA. This increase in volume has negatively affected the timeliness of the dispute resolution process. The CRA has started to implement elements of a business transformation model that takes full advantage of our existing resource base, capitalizes on established centres of expertise, and builds on recent business process change to distribute our less complex workload nationally.

Taxpayer relief

The taxpayer relief provisions of the various Acts administered by the CRA have enabled us to help taxpayers who, because of circumstances beyond their control, are unable to meet their tax obligations. These circumstances could be personal misfortunes (sickness, death in the family), natural or human-made disasters (fire, floods), service disruption (postal strike), or an error by the CRA (incorrect information). The taxpayer relief provisions give the Minister of National Revenue discretion to cancel or waive penalties or interest, accept certain late, amended or revoked elections (income tax only), and issue income tax refunds or reduce the amount payable beyond the normal three-year period (individuals and testamentary trusts only).

Providing certainty

Taxpayers can have certainty regarding their tax obligations through a variety of CRA service offerings.

Rulings and technical interpretations

The CRA interprets Canada's income tax law and provides clients through advance income tax rulings and technical interpretations. In recent years, the turnaround time for advance income tax rulings has been in excess of our published service standard. The service standard for advance income tax rulings and technical interpretations will be revised starting in the 2012-2013 fiscal year to take the increasing complexity of these files into account. The new target for advance income tax rulings and technical interpretation files service standards will be the completion of 85% of files within an average of 90 business days.

The CRA produces technical publications and newsletters that clarify our interpretation of income tax law. We will update the content of income tax interpretation bulletins to ensure that Canadians have access to the most accurate and timely information.

Voluntary disclosures

The Voluntary Disclosures Programs (VDP) strives to facilitate voluntary compliance by encouraging taxpayers to disclose unreported information and correct any inaccuracies or oversights to previously submitted information. Taxpayers who take advantage of the opportunities presented through the VDP may be able to avoid penalties or prosecution associated with tax non-compliance, provided they come forward prior to the CRA initiating any compliance action. These taxpayers are still required to pay the tax amounts owing as well as any interest that may apply to those amounts.

Administrative processes are being streamlined to improve taxpayer interaction and to make information culled from these disclosures available in a more efficient and effective manner. The program continues to be promoted through the CRA's communication strategy, tax intermediaries, and CRA partners. In addition, we have conducted public opinion research regarding the VDP and will develop action plan to address the findings of these studies.

Our performance indicators - Promoting compliance

These indicators will demonstrate whether we are making measurable improvements in achieving this core business outcome.

Our core business outcome - Canadians have access to the information they need to voluntarily comply with tax laws and have access to impartial and timely review of contested decisions

Activity	Performance indicator	Expected Result
Communicating with Canadians	Number of electronic outreach offerings created or revised	Upward trend Footnote 1
Being fair	Percentage of Appeals cases that met the service standard for initial contact within 30 days	85%
	Average age of workable inventory - income tax files	Neutral or downward trend Footnote 2
Providing certainty	Average number of days to issue an income tax technical interpretation and advance income tax ruling to taxpayers	90 days
	Average number of days to process voluntary disclosures	Downward trend Footnote 3

Footnote 1

The objective is to show an increase.

Footnote 2

The objective is to show a decrease or no change.

Footnote 3

The objective is to show a decrease.