DID you know that when Finance Minister Sir Thomas White introduced an income tax in Canada in 1917, it was supposed to be a temporary war measure? The bill was even called the War Tax Upon Income Bill to reflect the hope the tax would disappear once the war was over. However, as we’ve seen time and time again, there is nothing more permanent than a temporary tax measure.
Today, not only do we still have an income tax, the rules governing the tax have grown in number and complexity. The Income Tax Act currently has more than 1,400 pages.
I’m sure you, like me, understand that a complex tax system costs consumers, businesses, and the economy more than just a payment at tax time. The cost and hours spent to comply with the tax system adds up to a significant hidden cost. So, to build awareness and promote discussion among stakeholders, CGA-Canada recently published Issue in Focus: The Need for Tax Simplification – A Challenge and an Opportunity.
We want to see the personal and corporate income tax systems become simpler and more efficient. I don’t think this is an impossible dream. The federal government has done a good job lowering tax rates to create a competitive business environment and attract international investment, but it has done little to simplify the tax system. In fact, Canada’s tax system is one of the most complex in the world.
Tax simplification is in the public’s best interest – it is good for taxpayers, businesses, and government, as well as Canada’s economy. CGAs in business, industry, and private practice overwhelmingly tell us they want tax simplification made a priority issue for governments to tackle. We agree and are taking action to ensure your views on this important issue are heard.