“One sentiment that was stronger in the Individual Taxpayer sessions was the feeling that they were concerned about living in a place where people would be ‘snitching’ on each other and they didn’t want to feel like they were in a ‘communist state’ or a place where ‘big brother’ is watching,” said the report, obtained by Blacklock’s Reporter.
“Moreover, a few would be concerned with being identified as having reported the situation, and having to live with the ‘snitcher’ label.”
The findings, published in the report titled “2022 Annual Corporate Research Qualitative Component,” were based on 30 focus groups with individual taxpayers, small business managers, bookkeepers and accountants. It was conducted by market research firm Narrative Research on behalf of the CRA, to which the federal agency paid $147,957 for the service.
Participants said “it would be very difficult to be sure” whether someone is indeed cheating. “Even if you were sure, it is not your place or business.”
More Concerns
The CRA has in place a “leads program” where Canadians can submit information on tax cheating online or by telephone, mail, or fax. The informants’ tips are compiled by the National Leads Centre operated by the agency.The researchers noted that both individual taxpayers and small and medium-sized enterprises showed “great reluctance” to report personal or business tax evasion even when they are certain, for “fear of unfairly judging the situation.”
“People generally feel what others are doing is ‘none of their business’ with some of the belief there may be attenuating circumstances that may explain the cheating, especially for low income households,” the study said.
Trend
A report released by CRA last July noted there were 140 tax evasion convictions totalling over $72 million in federal tax combined between April 1, 2017 and March 31, 2022, resulting in more than $17 million in court fines and 119 years of jail time.The federal agency said at the time the average amount of tax evaded was reportedly higher than in previous fiscal periods.
“For example, the average evaded tax determined upon conviction is 73 percent higher than what it was previously ($299,000 from April 1, 2012, to March 31, 2017, compared to $517K from April 1, 2017, to March 31, 2022),” the agency said.
“In addition, between April 1, 2017, and March 31, 2022, the average fine increased by 14 percent compared to the previous five-year period, rising to an average of $122,000.”
An audit report by the CRA last February noted that the number of suspected tax cheating submitted more than doubled after the pandemic hit the country.
“This past year, the National Leads Centre processed over 60,000 leads, with the increase being attributed to leads related to COVID-19 benefits.”
The 60,000 leads included members of the public and 793 “internal leads.”
“Internal leads are submitted by CRA employees who have identified potential non-compliant behaviour through the course of their regular duties,” the report said.
