Records show the Canada Revenue Agency (CRA) questioned accountants whether they would report small businesses which do not pay their taxes, according to Blacklock’s Reporter. .“Very few were interested in the establishment of a system by which tax intermediaries or business owners and operators would report to the Canada Revenue Agency on those they believed might be participating in the underground economy,” said Strategy Corp researchers in a report. .“It was felt it was primarily the responsibility of individual businesses to properly report their income and most did not wish to involve themselves in the affairs of other businesses.”.Strategy Corp researchers said a small number reiterated the view “that they did not see the underground economy as a particular problem and do not wish to see any additional resources devoted by the agency toward addressing this issue.”.They added some felt it would be unlikely Canadians would report on one another. .The CRA estimated the underground economy was more than $61 billion per year. Business owners surveyed said lack of tax compliance was the Canadian government’s problem. .Researchers acknowledged tax compliance was not viewed as a moral obligation but more as a requirement under the law which, if breached, could lead to interest, penalties and possible legal action..They noted enterprises and tax intermediaries said the main motivation for filing accurately and on time was to avoid negative consequences. .Business owners and their accountants blamed “general disillusionment with government and a perceived lack of transparency or accountability regarding government expenditures.” .“Many participants, enterprises and tax intermediaries alike commented the Agency’s efforts might be better spent focusing on larger corporations which they felt are more able to take advantage of tax loopholes,” said the researchers. .Records published in 2022 said the COVID-19 pandemic resulted in more people trying to cheat the CRA. .READ MORE: Digital economy leading to more tax cheating.The CRA said expanded use of internet sales “amplified the risk online that income is not reported or is under-reported by individuals and businesses, especially since it cannot be identified using conventional techniques.” .Auditors did not estimate lost collections from unreported sales..Findings were based on questionnaires with tax preparers, accountants, and owners of small- and medium-sized businesses. The CRA paid $122,345 for the report by the Strategy Corp.
Records show the Canada Revenue Agency (CRA) questioned accountants whether they would report small businesses which do not pay their taxes, according to Blacklock’s Reporter. .“Very few were interested in the establishment of a system by which tax intermediaries or business owners and operators would report to the Canada Revenue Agency on those they believed might be participating in the underground economy,” said Strategy Corp researchers in a report. .“It was felt it was primarily the responsibility of individual businesses to properly report their income and most did not wish to involve themselves in the affairs of other businesses.”.Strategy Corp researchers said a small number reiterated the view “that they did not see the underground economy as a particular problem and do not wish to see any additional resources devoted by the agency toward addressing this issue.”.They added some felt it would be unlikely Canadians would report on one another. .The CRA estimated the underground economy was more than $61 billion per year. Business owners surveyed said lack of tax compliance was the Canadian government’s problem. .Researchers acknowledged tax compliance was not viewed as a moral obligation but more as a requirement under the law which, if breached, could lead to interest, penalties and possible legal action..They noted enterprises and tax intermediaries said the main motivation for filing accurately and on time was to avoid negative consequences. .Business owners and their accountants blamed “general disillusionment with government and a perceived lack of transparency or accountability regarding government expenditures.” .“Many participants, enterprises and tax intermediaries alike commented the Agency’s efforts might be better spent focusing on larger corporations which they felt are more able to take advantage of tax loopholes,” said the researchers. .Records published in 2022 said the COVID-19 pandemic resulted in more people trying to cheat the CRA. .READ MORE: Digital economy leading to more tax cheating.The CRA said expanded use of internet sales “amplified the risk online that income is not reported or is under-reported by individuals and businesses, especially since it cannot be identified using conventional techniques.” .Auditors did not estimate lost collections from unreported sales..Findings were based on questionnaires with tax preparers, accountants, and owners of small- and medium-sized businesses. The CRA paid $122,345 for the report by the Strategy Corp.
