Yahoo Finance Accountants group calls for comprehensive review of Canadian tax system
A new report by Chartered Professional Accountants of Canada (CPA Canada) is recommending the government undergo a comprehensive tax review that will “make the system simpler, fairer, more efficient and competitive.”
The report, released on Wednesday, provides a blueprint for how the government could reform the Canadian tax system, one CPA Canada said currently weakens the country’s competitiveness.
“At CPA Canada, we strongly believe a tax system review for Canada is long overdue,” the report says.
“With more than 50 years since our last full-scale tax review, the current tax system is in a sad state of repair, while our global peers, including the U.S., are leveraging their tax systems in an effort to boost their own competitiveness.”
CPA Canada consulted several organizations representing chartered accountants around the world and considered tax reviews in the United Kingdom, Australia and New Zealand for the report. In the end, the organization provided several recommendations on how a tax review should be conducted.
For the best results, CPA Canada said the review should be comprehensive, putting all aspects of the tax system up for review, and conducted by an independent expert panel appointed by the Minister of Finance. The report also said the review should be focused on making the system “simpler, fairer, more efficient and competitive” and aim to simplify and modernize tax policy while easing compliance for taxpayers.
The report says the consequences of not fixing the tax system will lead to diminished economic prospects across the board.
“Until we take a more universal approach to fix it, Canada’s competitive advantage will continue to fade, and prospects for sustainable growth and prosperity will continue to dim for Canadians, Canadian businesses and our economy overall.”
CPA Canada is not alone in its call for a significant overhaul of the tax system. According to the report, advocates from the Canadian Chamber of Commerce, Canadian Manufacturers & Exporters and the Senate Banking Committee have also called for a royal commission to review the system, while the House of Commons Standing Committee on Finance and the Business Council of Canada support an independent expert panel review.
The report follows another released by CPA Canada late last year that outlined the issues with the Canadian tax system. CPA Canada found that Canada’s tax system does not align with international trends, and that the complex system discourages compliance in many cases.
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