ARCHIVED - RPP 2007-2008
Canada Revenue Agency

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Chapter 4 – Achieving Our Strategic Outcomes

Introduction

Through our Canada-wide network and distributed processing operations, the CRA delivers tax services and benefit programs on behalf of the Government of Canada, provincial and territorial governments, and certain First Nations. The CRA’s mandate sets out two strategic outcomes:

• Taxpayers meet their obligations and Canada’s revenue base is protected;
• Eligible families and individuals receive timely and correct benefit payments.

These strategic outcomes govern the priorities we pursue and the investments we make to support those priorities.

Our Strategic Planning and Reporting Framework (see ) is the foundation of the 2007-2008 Report on Plans and Priorities. This framework links our strategic outcome measures to our two strategic outcomes, and identifies the expected results for the program activities that support these outcomes.

The Agency 2010 vision will guide us during the period covered by this report. Two themes of Agency 2010 shape the strategies we will pursue to achieve our strategic outcomes:

• strong and modern core business
• expanded business opportunities.

Strong and Modern Core Business

The core business of the CRA is tax administration, revenue collection and benefits administration. This is where our expertise lies and where we will focus our attention to identify opportunities for building our programs and services. Effective compliance and service delivery are key elements to the core business. Over the planning period, the CRA will continue to strive for excellence in service delivery and compliance. For example, for the first time we are introducing two new external service standards related to accuracy of information (Benefit Programs), as well as a standard for responding to taxpayer requested adjustments via the Internet (for new service standards, see Appendix D).

In addition, we believe that taxpayers’ compliance behaviour is influenced by their trust in the integrity and fairness of the tax administration system. We will therefore continue to improve our service and compliance programs, and administer them according to our values, to maintain the integrity and fairness of the tax system.

Expanded Business Opportunities

Our flexibilities as an agency and the adaptability of our systems enable us to use our federal delivery infrastructure to administer a range of programs and other services on behalf of clients. Throughout Canada, our approach is consistent on matters such as compliance activities, service standards, workflows and program administration. This approach instills confidence for clients that their programs will be administered efficiently and according to their expectations.

Over the planning period, we will maintain current programs and services administered for provinces, territories and other government departments, and look for potential efficiencies for clients.

The following pages provide more details about the strategies we will pursue to support the two main themes. Details about the specific approaches to these strategies, as well as the key initiatives we will undertake, are provided in Chapter 5 (which begins on ), where we describe our plans for each of our program activities.

Strategic Planning and Reporting Framework

Measures for each of these Expected Results can be found in the Program Activity chapter starting on .

The efforts of the CRA contribute to two of the Government of Canada’s Strategic Outcomes: Federal organizations that support all departments and agencies and Income security and Employment for Canadians.

Further information on these outcomes can be found at www.tbs-sct.gc.ca

Program Activities by Strategic Outcome

Agency Link to the Government of Canada Outcomes

Tax Services: Taxpayers meet their obligations and Canada’s revenue base is protected

Overview

We rely on the government’s revenue base to provide funding toward social and economic objectives. The CRA’s primary focus is to maintain the integrity of the administration of Canada’s tax system by delivering a wide range of programs to ensure that Canadians meet their tax obligations and, in so doing, help protect Canada’s revenue base.

Our five tax-related program activities are listed in our Strategic Planning and Reporting Framework (see ), along with their respective expected results. These program activities support the achievement of the tax services strategic outcome, by helping to ensure that taxpayers and businesses receive accurate information and assistance, in order for them to understand their rights and obligations. Our program activities identify instances when any of these obligations are not met, and they deter and correct non-compliance. Where taxpayers decide to exercise their right to a formal review of their file, the Appeals program activity conducts a formal and impartial review. Details describing our plans to strengthen tax services core business are provided on pages to .

Our Areas of Focus

In order to ensure the integrity and fairness of the Canadian system of tax administration, and to address areas of risk critical to strengthening our core business and fostering our ability to expand business opportunities, over the planning period we will focus on:

• continuing to enhance rights and service delivery for taxpayers;
• maximizing tax debt collections;
• addressing specific compliance challenges;
• enhancing trust in Canada’s tax administration; and
• enhancing partnerships with our clients.

Enhancing Service Delivery

We believe that, given the right opportunities, information and tools, most individuals and businesses will comply with the law. The open, responsive, timely and accessible nature of information on a taxpayer’s obligations is a key aspect of a fair revenue administration. It is our aim to make available current and accurate information in a manner that is best suited to the needs, abilities and preferences of taxpayers, thereby positively influencing compliance.

Over the planning period, we will enhance service delivery by:

• reducing the compliance and paperwork burden on small business, simplifying, improving, and, where appropriate, reducing the frequency of small business interactions with the CRA;
• encouraging the take-up of our electronic services;
• adding new services to our Web channel;
• building on our electronic services infrastructure; and
• continuing to develop innovative electronic initiatives to be more effective.

Descriptions of the specific initiatives that we will undertake in response to service program priorities are provided in Chapter 5, which begins on .

Maximizing Tax Debt Collections

A key measure that we use to evaluate our success in protecting Canada’s revenue base is taxpayers’ compliance with their remittance obligations. It is our aim to ensure that assessed and collectible taxes are paid in a timely manner.

To maximize revenue collection and revenue generation over the planning period, we will undertake the following:

• integrate business processes, and improve our risk profiling capability regarding accounts subject to our tax debt activities; and
• implement integrated and effective risk profiling and scoring for all debt types, as well as the integration of business processes.

Additional details concerning our plans to maximize tax debt collections and mitigate risk of loss are provided beginning on in our Accounts Receivable and Returns Compliance (PA3) program activity.

Addressing Non-Compliance

Over the 2007-2008 planning period, we will continue to pursue the compliance priorities identified in the previous report on plans and priorities: aggressive tax planning, the underground economy, GST/HST fraud, non-filers, non-registrants and collections.

In addition, we will increase our focus on compliance issues related to international commerce through the following approaches:

• focusing on high-risk taxpayers and intermediaries who develop and promote aggressive international tax planning schemes;
• using communications strategically to increase awareness of CRA compliance activities to deter international non-compliance;
• working in collaboration with the Department of Finance Canada in developing enhanced policy and legislative change proposals to target international non-compliance; and
• strengthening our relationships with other tax administrations and organizations, such as the OECD and the Commonwealth Association of Tax Administrators.

We will also increase our focus on interprovincial compliance issues. Specifically, we will

• develop strategies to address profit shifting and provincial tax avoidance; and
• work to address concerns about provincial income allocation, to ensure that our clients receive the tax revenue derived from the economic activity undertaken in their jurisdictions.

Specific program priorities for addressing these items are discussed in our Reporting Compliance (PA4) program activity section, beginning on .

Enhancing Trust

Our ability to protect Canada’s revenue base can be affected by the public’s confidence in the firmness and fairness of the overall tax administration system and Canadians’ trust in the integrity of the CRA. To earn and retain the trust of Canadians requires a tax administration that is both fair and seen to be fair.

Keeping personal information secure is also key to maintaining the trust of Canadians. The Agency’s rigorous IT and administrative security programs will ensure that their information is protected.

Enhancing Partnerships

The CRA has established partnerships with other federal government departments, provinces, territories and First Nations governments for many years. We believe that our strengths and competitive advantages increase the effectiveness and efficiency of tax administration and revenue collection for all levels of government in Canada. In addition, taxpayers—especially businesses—find it much more effective to deal with a single administration for their tax issues.

For these reasons, enhancing our partnerships is a key focus over the planning period. The CRA will undertake the following:

• complete the implementation of our agreement with the Government of Ontario to design and implement a single corporate income tax;
• continue to work toward creating new opportunities for partnerships with interested provinces, territories, First Nations governments, and other federal government departments and agencies to reduce duplication and enable single-window delivery of services; and
• improve the scope and quality of current partnerships with other federal departments and provincial and territorial governments.

Specific steps to be taken in this regard are discussed throughout the program activity sections related to tax services (PA1 to PA5), on pages to .

Strategic Outcome Measures—Tax Services

We estimate the rates of compliance in a number of areas to assess whether or not taxpayers are meeting their obligations, and to identify potential compliance issues. Compliance measures are grouped under four headings that equate to the following broad categories of taxpayer obligations.

• Filing compliance measures estimate the proportion of taxpayers who file their returns on time.
• Our registration compliance measure estimates the proportion of Canadian businesses that have registered, as required by law, to collect GST/HST.
• Remittance compliance measures estimate the proportion of taxpayers who paid amounts due on time.
• Reporting compliance measures contribute to our assessment of the degree to which taxpayers report complete and accurate information to allow for the determination of their liability for tax.

We have also identified a strategic measure intended to gauge our achievements as a key service provider for clients.

Recent results reported against some of our key compliance rate measures have indicated specific areas where compliance rates have not met our expectations. We believe that focusing over the planning period on the key areas described earlier will have a positive influence on the recent slight downward trends in the following key measures:

• timeliness of the filing of income tax returns by taxable corporations;
• timeliness of remittances by employers and taxable corporations; and
• levels of individuals’ claims for key deductions and credits not subject to third-party reporting.

In addition, we will develop strategic outcome measures for both registered charities and registered plans over the planning period, in order to gauge our success in administering both of these very important sectors of Canada’s economy.

Benefit Programs: Eligible families and individuals receive timely and correct benefit payments

Overview

The CRA supports the efforts of federal, provincial and territorial governments to assist families and children, low- and moderate-income households, and persons with disabilities. We do this by providing Canadians with benefits, credits and other services that contribute directly to their economic and social well-being.

In addition, our flexibilities as an agency and the adaptability of our systems enable us to leverage our federal delivery infrastructure to administer a range of ongoing and one-time programs on behalf of the provinces, territories and other government departments, and provide information, as authorized by law, to support programs administered by provinces, territories and other government departments.

Our Benefit Programs program activity, and the related expected results, are included in our Strategic Planning and Reporting Framework (see ). This program activity supports the achievement of the Benefit Programs strategic outcome by helping to ensure that recipients are informed about our programs, that they clearly understand what they need to do to meet eligibility requirements and receive their entitlements, and that they understand their obligations when their family circumstances change. When our efforts are successful, eligible recipients can count on receiving the right benefit at the right time, and on knowing where the benefit came from and why.

Our Areas of Focus

To strengthen our core business and foster our ability to expand business opportunities, over the planning period we will focus on the following approaches:

• enhancing electronic services for benefit recipients;
• maintaining strong performance in the timely issuance of millions of benefit payments;
• ensuring that only those who are entitled receive benefits, through strengthened benefits compliance; and
• maintaining the current programs and services administered for provinces, territories and other government departments, and fostering business growth.

Enhancing Electronic Services

We believe that, when benefit recipients are given the right information, tools and services, accessible through a variety of channels, they will be able to provide us with the information we need to register them and maintain complete and accurate benefit account information, thereby positively influencing program awareness, take-up and overall rates of benefits compliance.

Over the planning period, we will enhance electronic services by:

• adding new features to My Account, particularly for the Disability Tax Credit, and promoting take-up; and
• implementing a facility for online benefits applications.

Timely Benefit Payments

Ensuring timely payments for millions of recipients, based on the accurate determination of program eligibility, takes continuous planning and effort; it is not automatic. Changes to our systems, which are required annually, are thoroughly planned, monitored and tested before implementation. Our processes are designed with safeguards and checkpoints to contain the risks of delays or interruption. New or revised programs are carefully negotiated with program owners to ensure that their requirements can be achieved without interrupting existing program delivery commitments.

To maintain strong performance in the timely issuance of benefit payments, we will continue the multi-year effort of reassessing our core payment processing system and our Individual Identification System to ensure that they retain the capacity to deliver high quality programs.

Accurate Benefit Payments by Strengthening Compliance

We need to ensure that the benefits and credits we issue are correct and that eligible recipients receive the proper entitlement—no more and no less—based on complete and accurate payment and account information, in accordance with applicable legislation.

To positively influence and maintain existing high levels of benefits compliance, we will undertake the following over the planning period:

• continue to implement key elements of the Compliance Strategy for Benefits, in order to ensure program integrity; and
• develop methodologies to measure overall compliance for the GST/HST credit program.

Business Growth

We believe that our strong federal benefit delivery infrastructure, which makes use of adaptable automated systems, enables the CRA to attract a range of programs and a variety of services that we can provide for provinces, territories and other government departments. Our objectives in doing so are to lower the overall cost of benefit program administration for all levels of government while maintaining high quality and secure service to benefit recipients.

Provinces, territories and other federal government departments also depend on CRA data exchanges and data transfers to support their own income-tested benefit and payment programs. Sharing of a limited amount of data, done with taxpayer consent or as authorized by law, simplifies the administration of programs and minimizes the burden on applicants.

To improve benefits administration for all levels of government, we will undertake the following:

• continue to use our unique technology and national benefit delivery infrastructure (our competitive advantage as a service provider) to deliver new programs, where feasible; and
• expand data exchange services using file transfer protocol (FTP) methodology, where feasible.

Details beginning on in our Benefit Programs (PA6) program activity describe our specific plans over the next three years.

Strategic Outcome Measures—Benefit Programs

Our strategic outcome for Benefit Programs, and the measures we employ to evaluate our success, focus on the timeliness and accuracy of the payments we issue, as well as on the number of programs and services we deliver on behalf of clients. We expect the results we achieve to influence program enrolment and awareness among eligible recipients, maintain timely and accurate payments, and enhance the contribution we make to clients as a key program administrator and service provider.

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