Yearly Archives: 2020

Getting Good Results

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In this series of articles, we begin by reviewing the purpose of the CVITP. While the Canada Revenue Agency publications do not give a formal purpose, we look through recent government references to the CVITP and suggest that its purpose is to help individuals on modest and low incomes, and especially vulnerable individuals, to file their income tax and benefit returns.

We then ask whether or not the CVITP is achieving this purpose.  We conclude that the information provided in the Canada Revenue Agency’s current results framework for the CVITP is not useful because it does not tell us if the program is serving the intended population.  Furthermore, the results the Canada Revenue Agency reports on, based on this framework, do not enable us to know if recent budget increases for the CVITP are helping it to reach a greater proportion of its intended population.

To address these weaknesses, we propose an alternate results framework for the CVITP.  We believe it holds more promise for providing the Canada Revenue Agency with results data which will allow for more strategic decision-making, better ensuring the CVITP lives up to its stated intention.

Client or Volunteer Error? Promoting Learning and Improving Service Quality

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Volunteers make mistakes in filling out client returns. After all, to err is human. Here is what the Canada Revenue Agency could be doing to promote learning among its volunteers while improving CVITP service quality. At the same time, it would demonstrate a commitment to further protecting the integrity and reputation of the CVITP which encompasses its host organizations and volunteers.

Supporting Host Organizations Better

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The federal government’s Poverty Reduction Strategy identifies the CVITP as one of its programs that contributes to achieving its goal of reducing poverty in Canada.  This is because the annual income tax and benefit return processed by the CVITP serves as the basis for establishing eligibility for and maintaining access to many federal and provincial/territorial benefits and credits, some of which are income-tested. 

Set up by the Canada Revenue Agency (CRA), the CVITP is a free return preparation and filing service offered, in 2019, by over 3,500 host organizations to some 741,000 low and modest-income individuals filing 835,216 returns with the assistance of over 19,000 volunteers.  Yet the CRA provides no financial support to assist host organizations with any of the costs they incur to make this possible.  Instead, it encourages host organizations to do their own independent fundraising.  This has not proven to be a successful nor sustainable solution.

To maintain and improve CVITP services, the CRA should be providing direct financial support to host organizations.  It should also spin off some of the CVITP related services it currently provides to an independent not-for-profit unit, financed through a service contract with the CRA.  This independent unit could provide these as well as other new CVITP related services not presently available to host organizations.

This proposed arrangement is in keeping with current federal government practice wherein federal services to the public delivered by independent parties receive some financial support.  In the absence of such a change, host organizations will continue to struggle to maintain the current level of service and will not be positioned to improve their CVITP services in line with CRA expectations.  Furthermore, the entire CVITP operation will remain at risk, as was evidenced this year when COVID related public health restrictions temporarily shut them down and willing host organizations moved to more labour intense “virtual clinics”.

Read here to learn more about the difficult conditions in which host organizations currently operate and why this severely limits the potential of the CVITP, one form that CRA financial support to host organizations could take, and why there is also the need for an independent unit as well as what it could be do to help fulfill the potential of the CVITP.

The Issue of Non-filers

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Conservative estimates suggest there are over 1 million eligible people in Canada who do not file annually.  A significant number, perhaps the majority, are individuals living on very low incomes.  Because they do not file, they are missing out on important federal and provincial/territorial benefits.

The Canada Revenue Agency (CRA) recently introduced an initiative to encourage low-income non-filers to file their income tax and benefit returns.  However, the success rate for this initiative is pitifully low.

This article suggests why the CRA should and how it could work with CVITP host organizations to significantly increase the number of low-income non-filers who decide to file returns.

Automatic Tax Filing: a Solution or a Problem?

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The most recent Speech from the Throne contained a reference to the introduction of automatic tax filing of returns.  We believe that the process of moving toward automatic filing will take some time as the federal government will first have to negotiate changes with the provinces and territories; many income tax and benefit returns will remain too complicated to be filed automatically; and automatic return preparation may be a more appropriate way to think of the change as people will still have to agree to the results before their returns can be filed.  Consequently, even when automatic filing is eventually introduced, we think that CVITP clinics will remain an essential service for many clients with low or modest incomes.

Read more about why we think this here.

How well are your CVITP clinics targeted to clients who need this service the most?

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For many CVITP host organizations, the demand for free clinic services exceeds the supply of volunteer time available to prepare returns.  The income ceilings suggested by the Canada Revenue Agency (CRA) are an established way of limiting access to this free service.  This article compares the income ceilings suggested by CVITP with the incomes that make up poverty lines and finds that, with a few exceptions, the former are generally greater than the latter.  Host organizations which want to target their services to those who need it the most may wish to use income ceilings that are more closely aligned with the poverty lines for their region.

To learn more, you can read the full article here.

A Primer on Canada’s Official Poverty Line and Why It Matters to the CVITP

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Canada’s Poverty Reduction Strategy gives time-bound targets for making progress in reducing poverty linked to one indicator.  This suggests that the federal government can be held accountable for its efforts in achieving these time-bound targets.  The indicator it uses is an official poverty line.  The official poverty line is a uniquely income-based concept.  The targets are as follows:

– By 2020, the poverty rate will be reduced by 20% from its 2015 level, and

– By 2030, the poverty rate will be reduced by 50% from its 2015 level (aligned with the United Nations Sustainable Development Goals)

In other words, the official poverty line can be used to calculate the poverty rate: the percentage of the population with an annual income lying below this line at a particular point in time forms the poverty rate.

In an article entitled A Primer on Canada’s Official Poverty Line and Why It Matters to the CVITP, we explore what the official poverty line is and how it is used to determine poverty rates.  In the conclusion, we draw the CVITP’s connection with this official poverty line.  As you will see, the income tax and benefit returns processed by the CVITP play a crucial role in helping to raise clients’ incomes relative to the official poverty line.

The Evolution of the CVITP

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In a series of articles, we trace the evolution of the CVITP, using information from Canada Revenue Agency (CRA) reports and plans for Parliament. Our articles tell you about the clients served by the CVITP tax clinics, the returns that have been filed at the these clinics, the CVITP volunteers who have helped clients to file their returns and the organizations which have hosted CVITP tax clinics.

Learn why we reach the conclusion that “the CRA’s reporting on the CVITP has been weak to date and gives Parliament too little information.”

Interested? Start with the introduction to “The Evolution of the CVITP”.

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