I’m not one to regularly bash the Canada Revenue Agency. It has a very important job to do which is to administer the country’s very complex taxation laws and those of most provinces and territories. If a country has income tax laws, it had better properly administer them.

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In all my years of dealing with the CRA, I have had mostly good experiences. There are some very good and dedicated public servants who take pride in the job they do and generally do it well. Don’t get me wrong, I have had my fair share of head-scratching moments as well, or days when you wonder how the person you’re dealing with got the job in the first place. But, again, my experiences have generally been good.

In many of the recent federal budgets, there have been significant amounts of money added to the CRA’s budget. In some of the recent budgets, the additions were under the guise of going after “offshore tax evasion” (a long-time bogeyman phrase that has more fiction to it than fact).

The CRA’s headcount has also been growing. It had 39,484 employees in 2016, but that has grown to 59,019 as of 2023 (last updated in June 2023). That is a 49.5 per cent growth rate in the span of eight years.

Canada’s population has been growing as well (especially recently), but the CRA’s pace of employment growth is certainly outpacing that growth. In some of the recent years, the CRA’s headcount increase was due to the administration of COVID-19 support programs, but the trajectory was on a steep incline even before such demands.

The CRA has long been one of the country’s largest employers. Accordingly, I don’t think it’s unreasonable to ask whether or not Canada is getting good value for its large annual outlay in salary and other costs. An annual read of the CRA’s Departmental Results Report is always interesting to see how it evaluates itself.

The view from the “cheap seats” (meaning taxpayers and their advisers) always has the following general comments about the value provided by the CRA: phone call wait times are horrifically long; or you can’t get through at all; the technology is archaic and frustrating (but to be fair, one can understand that security of information is critical so the CRA must always prioritize security ahead of convenience); and auditors or other frontline employees are inexperienced and not helpful.

The above list is generally fair and certainly consistent feedback. Recently, though, the above complaints, in my experience, have been magnified even more. It’s pretty obvious that a good chunk of the CRA’s employees are still “working from home.” While CRA employees may find that more convenient, it is doubtful that it adds to overall productivity, good training and a better “client experience.”

In recent years, there have been no shortage of horrible cellphone connections that often drop when conversing with a CRA employee, spotty Microsoft Teams meetings with the CRA’s fake virtual background, blanket/voluminous requests sent to taxpayers that are out of touch, unacceptable turnaround times to resolve even routine matters and agents who are so obviously undertrained.

The CRA has historically competed for talent with the professional community. In most cases, the professional community can pay more, but the CRA can often offer more time off and better long-term pensions. Does this impact the overall quality of the applicants? One can debate that forever. At a minimum, though, it is clear from a number of my recent experiences that the CRA’s training for its new employees needs to be improved with better results.

Overall, though, it’s long overdue to question why the CRA’s headcount is growing while its “client experience” is less than appealing. Our income tax statutes are certainly growing in complexity, so proper administration demands a highly educated/trained workforce to ensure good, but targeted compliance.

It would also be good to see the significant funding increases afforded to the CRA in recent years partially re-directed to the Tax Court of Canada, which is in dire need of technology and other improvements so as to help it handle its workload.

I have sat in the audience at a number of tax conferences in recent years where representatives from the Tax Court have publicly pleaded with the federal government to increase their resources in order to help with the administration of justice in a more timely and efficient manner.

I appreciate that is often easier said than done, but it does on its face appear to be a decent alternative to simply throwing more money at the CRA so it can continue to hire more employees.

Kim Moody, FCPA, FCA, TEP, is the founder of Moodys Tax/Moodys Private Client, a former chair of the Canadian Tax Foundation, former chair of the Society of Estate Practitioners (Canada) and has held many other leadership positions in the Canadian tax community. He can be reached at kgcm@kimgcmoody.com and his LinkedIn profile is www.linkedin.com/in/kimmoody.

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