Performance by business line

Context: risks and challenges

At the CCRA 1 , we are vigilant about managing ongoing risks, while maintaining the capacity to respond to sudden developments in our operating environment over which we have little direct control. In this respect, 2003-2004 was no exception.

The growth in self-employment and contract work, particularly, may present tax compliance risks. As more Canadians enter into new work arrangements that are not covered by source deductions, they must take on accounting, reporting, and filing obligations with which they are often unfamiliar. To help them meet these responsibilities, we continue to customize our information services and, wherever possible, simplify procedures to reduce the time and financial costs associated with compliance.

In planning for the future, the CCRA is equipping itself to meet challenges and improve effectiveness by becoming more client-centred. At the same time, we must continually balance our innovation objectives with the need to maintain sufficient resources in our core operations to preserve the integrity of our compliance programs.

At the international level, global economic integration, the mobility of capital and labour, and the growth of e-commerce pose a worldwide challenge for tax administrations. The proliferation of tax havens, the increased marketing of abusive tax arrangements, and the aggressive pricing of cross-border transactions by some multinational corporations all pose a potentially significant threat to the tax base. Through our tax treaty partnerships and our participation in international organizations, we develop international tax strategies and share information and best practices to mitigate the risk of non-compliance in international transactions.

Fuelled by increasing numbers of registered businesses and the high turnover of businesses in sensitive sectors, these same international developments have made the administration of value-added taxes more challenging. Many countries have been dealing with the challenge of value-added tax fraud, including Canada with the GST/HST. While all tax carries the risk of fraud, we do much to mitigate those risks. We are vigilant in identifying possible fraud and evasion through a variety of means including post-audits, prepayment audits of refund claims, profiles of high-risk registrants, informant leads, and partnerships with other law enforcement agencies. All suspected cases of fraud are evaluated for prosecution potential and where further investigation reveals sufficient evidence to support a conviction of wilful non-compliance, cases are referred to the Department of Justice for prosecution.

Over the course of the fiscal year, the CCRA continued to explore possibilities for broader partnerships with the provinces and territories and to expand the portfolio of programs we deliver on their behalf. However, relationships between governments are complex. Issues often outside our control may impede initiatives to forge new partnerships. Nonetheless, we made some progress in the programs and services we administer and enhanced our capacity to collaborate in the future.

The responsibility for maintaining a high level of values and ethics is nowhere more important than when dealing with the confidential personal information of our clients. It is the CCRA's policy to protect the confidentiality of client information and to manage client information in accordance with the provisions of the privacy and access to information laws, the Government policies related to security, and the confidentiality provisions of the legislation we administer. CCRA employees and managers are expected to have a high degree of knowledge about the protection of client information and their roles and responsibilities are clearly detailed in our Policy on the Management of Protected Client Information.

1 See Schedule H for a glossary of acronyms.

Date modified:

2004-10-28