Understanding Revenue Canada

Understanding Revenue Canada

Canada Revenue Agency or CRA

Understanding Revenue Canada begins with a simple definition: the Canada Revenue Agency, or CRA, is the principal revenue collector for the federal government. Annually, Revenue Canada collects over $300 billion in taxes and other revenues and distributes close to $12.5 billion in benefit payments to millions of families and individuals on behalf of the federal, provincial, and territorial governments, as well as First Nations.

Quite a large part of the public service, Canada Revenue employs up to 34,300 permanent employees at 55 service sites across the country.

Our mandate and strategic direction focus on promoting compliance with the legislation we administer ... we believe in providing service excellence to all our clients, supported by fair and responsible enforcement, to ensure the integrity of our tax and benefits system and to maintain the trust and confidence of Canadians.

From the CRA 2004-2005 Annual Report to Parliament

“Fair and responsible enforcement” includes the concept of Tax Amnesty. Tax Amnesty is a fairness program, authorized under the provisions of the Income Tax and the Excise Tax Acts. Revenue Canada has been given the discretionary right to cancel penalties as part of an individual or corporate tax liability. Provincial authorities have similar legislation in place.

Fairness provisions also give federal and provincial compliance officers legislative authority to waive or reduce outstanding interest.

An introduction to the concept of Tax Amnesty is available in our article What Is Tax Amnesty?.

The Canadian tax system is one of the most complicated in the world, and expensive to administer. Because tax collection costs, using other methods, are expensive, government obtains a real advantage from their Tax Amnesty policy. Anything that brings in money without much effort or expense and encourages compliance is welcome. If negotiations are properly handled and a reasonable settlement is achieved, it can be a win/win for both the taxpayer and Revenue Canada.