The federal government seems to be moving towards forcing Canadians to file their tax returns electronically. At the same time they are doing little or nothing to facilitate such a change. I think the government is creating an unfair and divisive situation where some people can afford to get their taxes done properly, on time and with the maximum benefit or minimum owing, and others are spending money they cannot afford just to get their taxes filed.
The Government Must Offer a Government Mechanism to File Electronically
The first logical step to automating Canada’s tax return system would be to provide every taxpayer with access to a government-run website to enter their tax data.
As a first step, it should be possible for a taxpayer to open a folder and within that folder to open each Schedule and Form needed to submit a paper return. They should then be able to simply type the data from their paper return into the appropriate spaces on this electronic mirror image. This should be an encrypted internet-accessible program similar to an online banking program. The taxpayer should not have to download any programs or install any software. It should be able to run on the common platforms available in public libraries and community access locations.
The next step would be for the government to simplify what the taxpayer needs to type into the mirror replicas of the paper forms so that the mathematical calculations are done automatically. The taxpayer should just have to review those fields against their paper return and make sure they match.
Ideally, later, the government should provide a free full-featured program similar to those commercially available to guide taxpayers through paying their taxes.
Why Even Government-Provided Programs Are not an Ideal Answer
Even this is not a great solution. Taxpayers without personal computers would be forced to have their personal financial information on display at a public place such as a library. I can foresee some criminal minds realizing they could place secret video cameras to capture this identity and financial information.
The amount of time available at places like libraries is also very limited. It’s not always possible to get internet access at a library now, much less if hundreds of people were lined up waiting to file their taxes. (Remember most forms required to file taxes are only available after February 28, yet the tax filing deadline is April 30.)
Private Enterprise should not be the ONLY Option
The current system is not working.
Most people have to pay to buy software, install it on their own computer and use it to calculate and file their taxes. Or they have to take their information to a third party’s office and pay them to fill out and file their return. (Or they have to file a paper return, which works perfectly well but which is what the government is trying to force users to stop doing.)
Why should a taxpayer have to pay a private company to pay their taxes?
Why should a person who cannot afford a computer have to pay someone to file their taxes?
Why should someone who cannot use a computer due to age or disability but not lack of money have to pay someone else to file their taxes?
If the government wants to allow third party software programs to continue to be used, that’s fine. There are many tasks in life where people prefer one type of program over another. But there should be an option to use a free accessible government program. The only option right now is to buy a program from a third party. (Or use free software from a third party knowing that morally they should make a donation to keep those companies open.)
Using Third Party Software is Frightening to Many Taxpayers
Why should taxpayers have to take a chance that they may download a virus to their computer when they use a non-government program to pay their taxes?
Why should taxpayers have to worry that some private company may embed (knowingly or unwittingly) a malicious program inside their tax return program that provides personal and private information illegally to another person?
Why should taxpayers have to worry that software is not properly calculating their taxes? I have had readers ask me whether the personal exemption was being applied, whether credits were being properly shared between spouses and other questions that suggest a basic lack of faith in the program.
Free Software is NOT Available to Everyone
Only two programs were available for free in 2013 (for 2012 returns) for taxpayers making an income of over $35000: GenuTax Standard 2012 and StudioTax 2012. Both of these programs require the user to download and install software.
You cannot download software and install it on most publicly accessible free computers. For example, you cannot do this at a public library or at any public accessibility computer I have ever seen. (If you disagree with me, please provide information about where this can be done with a comment.)
That means if
- The taxpayer does not have a computer
- The taxpayer does not have a computer with an operating system compatible with the software
- The taxpayer does not understand how to download and install programs
They cannot use these free programs. (NOTE: These programs are actually “pay what you can” programs. Without donations their programmers will have to stop offering them.
Free Software Cannot Provide Customized Service
Free software has very limited resources to provide technical assistance to users. You can’t expect a company that is already offering tax software for free to also employ hundreds of people to deal with the inevitable questions and errors. The government should provide the software and the government should provide the technical assistance because it is the government that is forcing this shift in usage.
Community Tax Volunteers are Already Stretched
There are many kind persons in Canada who take a course and help others file their tax returns. These are wonderful volunteers who deserve to be applauded.
However, there are not nor can there ever be enough volunteers to help everyone file their taxes. As it stands now, most volunteer groups have to limit their help to those with very low incomes and very simple returns.
Conclusion
The government should take responsibility for making tax filing simpler and easier so people can file their own taxes without assistance.
Related Reading
- How Can I File My 2012 Canadian Taxes Online in 2013 for Free Using NETFILE if my Income is over $35,000?
- How to Download and Install StudioTax Software to Calculate and File your 2012 Canadian Income Taxes Online for Free
- How to Download and Install Free GenuTax Software to Do and File Your 2012 Canadian Income Taxes
Join In
Do you think the government is pushing the “free enterprise” envelope too far by expecting us to buy software just to file our taxes? Please share your views with a comment.
The poorest folks are least likely to have access to safe (i.e. non-public computers). They also pay less taxes and are more likely to receive money back. The government, from a policy perspective, doesn’t even WANT these people to file returns — and they can still go after people who don’t file and owe money. It’s a cash grab, plain and simple.
I suspect that’s crediting them with a bit too much intelligence. : )
I think they just don’t think about how these changes will actually work.
Governments often don’t think these policies through very well.
It’s like the politicians in Florida who made it illegal to drive with just a foreign driver’s licence, you need to also have an international driver’s licence. Apparently they wanted to ensure everyone had a licence written in English that could be understood by their traffic police: they totally overlooked the fact that Canadians are (a) international/foreign driver’s and (b) have almost all got licences written in English. They nearly ruined an entire tourism season except at the 11th hour they withdrew the law for amendment!