Fraser Institute Press Release: Compliance Costs for Canadians Filing Personal Income Taxes in 2023 Are Estimated at $4.2 Billion

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VANCOUVER, British Columbia, April 30, 2024 (GLOBE NEWSWIRE) — The total compliance costs of filing personal income taxes in 2023 are estimated at $130 per Canadian taxpayer, or a total of $4.2 billion, it says independent, non-partisan Canadian public policy think tank in a new study released today by the Fraser Institute.

“Overall, personal income and payroll tax compliance costs represent a significant burden on Canadians to ease a process that is already widely viewed as a financial burden by many Canadians,” said Jake Fuss, director of financial studies at the Fraser Institute.

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Income Tax Compliance for Canadians: How and at What Cost? uses a new survey and finds that around half of taxpayers (50 percent) prepared their 2022 income tax return themselves, while more than a third (37 percent) used a paid tax preparer.

Those who prepare their own tax return report primarily do so (85 percent of self-preparers) using software.

The total compliance costs associated with personal income tax filing in 2022 are estimated at $4.2 billion, equivalent to 0.15 percent of the national GDP. In addition, the total administrative and compliance burden of tax collection in Canada is estimated at 0.6 percent of GDP.

The study suggests that one way to reduce these compliance costs is to create pre-populated income tax reports for Canadians, thereby streamlining the process for taxpayers. It is estimated that pre-populated reporting results in a one-third reduction in the overall cost of income tax compliance for Canadians.

“If this process were made more efficient for Canadian taxpayers, the federal government would not only save them money but also time, another valuable resource spent during tax season,” Fuss said.

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MEDIA CONTACT:

Jake Fuss, Director, Financial Studies
Fraser Institute

To arrange media interviews or for further information, please contact:
Drue MacPherson, Fraser Institute, (604) 688-0221 ext 721
[email protected]

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The Fraser Institute is an independent Canadian public policy research and education organization with offices in Vancouver, Calgary, Toronto, Montreal and Halifax and is connected to a global network of think tanks in 87 countries. Its mission is to improve the quality of life of Canadians, their families and future generations by studying, measuring and widely communicating the impact of government policies, entrepreneurship and choice on their well-being. In order to protect the institute’s independence, it does not accept government grants or research contracts. Visit www.fraserinstitute.org

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