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Why Ontario and BC Perform Poorly Compared to New Brunswick and PEI
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In a recent article on the CVITP participation rates of those living in poverty, we noted that “New Brunswick has the best participation rate, with 43.4% of the province’s poor receiving CVITP services. At 17.4%, Ontario has the worst participation rate among the provinces, well below the rate for all the provinces combined (24.3%).”
The purpose of this article is to explore some of the reasons for these wide divergences. To help find some of the reasons, we compare the two best performers, New Brunswick and Prince Edward Island (PEI), with the two weakest performers, Ontario and British Columbia (BC).
First, we dismiss a couple of reasons we think are not relevant. Next, we analyze the Canada Revenue Agency (CRA) CVITP data for 2021 at the provincial level. Here we discover three important differences between these high and low performing provinces. Then we look at the provincial level data in 2022 and 2023. We want to see if there have been changes since 2021 in these three areas which might significantly improve the CVITP participation rates of the poor performers relative to the strong performers.
Finally, we link these differences with the expected results of the CRA’s pilot grant program. We argue that the developments in these areas prove the pilot did not achieve two and arguably three of its four expected results. (No CRA data has been made public which allows for an assessment of the fourth area.)
Read here about the three differences between the high and low performing provinces in 2021, how these differences evolved between 2021 and 2023, and why we believe they demonstrate that the CRA’s pilot grant program has been a disappointment.
CVITP Has Been Forgotten by National Advisory Council on Poverty
Our work is based on the connection the federal government has drawn between poverty reduction and the CVITP in its 2018 Poverty Reduction Strategy. Specifically, this strategy recognizes the important role the CVITP plays in providing access to the many federal (and provincial/territorial) benefits designed to reduce poverty.
Following the publication of the Strategy, the Poverty Reduction Act was adopted as law by Parliament in 2019. Among other things, the Act requires the federal government to set up a National Advisory Council on Poverty. To date, the Council has produced five annual reports (2020 – 2024). Yet nowhere in these five reports is any mention made of the CVITP. We find this surprising.
In its reports, the Council urges improved access to existing benefits. Yet the Council never considers the role that the CVITP currently plays in facilitating access to those benefits, the challenges it faces in doing this and its weak performance in meeting these challenges.
Learn here why we think the Council should not remain silent on the only federal government initiative designed to help those living in poverty get the benefits to which they are entitled. Read here what the Council should instead be doing.
Inequalities of Access to Free CVITP Services Across Canada
There are great disparities in vulnerable Canadians’ access to CVITP services across Canada. This shows up clearly in the different rates of participation in CVITP services between the provinces.
In this article, we look at the 2020 provincial poverty data Statistics Canada estimated using its Market Basket Measure or MBM. (At that time, Statistics Canada had yet to establish a separate MBM for the territories.) We compare this data with the CRA’s data on the number of CVITP clients served in each province during the 2021 tax filing season. From this, we calculate the percentage of those living in poverty who were served by the CVITP. (We use the generous assumption that all individuals served by the CVITP in 2021 were living in poverty in 2020.) This gives us what we call CVITP participation rates by province.
These rates vary substantially between the provinces. See here how your province ranks in comparison to the other provinces in providing CVITP services to those living in poverty.
CRA’s Automatic Tax Filing: Shortcomings of the “SimpleFile” Pilot
In a series of three articles, we look at three initiatives other than the CVITP that the Canada Revenue Agency (CRA) seems to be focusing its efforts on to reach low and modest-income Canadian residents. We show why these initiatives presently show less promise than the CVITP in tackling the fundamental problem of helping a greater percentage of Canada’s impoverished residents access the benefits to which they are entitled.
In the first article of this series, we looked at the CRA’s non-filers benefits letter initiative. We argued that the results are insignificant, even questionable and bear no comparison with those obtained by the CVITP when it comes to assisting those living in poverty.
In the second article, we looked at SimpleFile by Phone, the CRA’s automated phone service for filing returns which has operated since 2018 under a different name, File My Return. We concluded that the results are insignificant, especially when compared with those produced by the CVITP. It is also far less cost efficient in producing results than the CVITP. Furthermore, we showed why the service does not live up to its stated promise of helping Canadians who have not filed in the past to access their benefits.
In this third article, we look at the CRA’s long awaited pilot for automatic tax filing, SimpleFile, which was launched in July 2024. Learn here why we think that, unlike its billing, filing a return under this new method is not automatic, the process is not “simple” to complete, this new method will not reach non-filers as originally intended, and the launch of the pilot is not well timed so is likely to perform poorly.
Rebranding “File My Return” as “Simplefile by Phone” Fails to Get Better Results
In a series of three articles, we look at three initiatives other than the CVITP that the CRA seems to be focusing its efforts on to reach low and modest-income Canadian residents. We show why these initiatives presently show less promise than the CVITP in tackling the fundamental problem of helping a greater percentage of Canada’s impoverished residents access the benefits to which they are entitled.
In the first article of this series, we looked at the CRA’s non-filers benefits letter initiative. We argued that the results are insignificant, even questionable and bear no comparison with those obtained by the CVITP when it comes to assisting those living in poverty.
In this second article, we look at SimpleFile by Phone, the CRA’s automated phone service for filing returns which has operated since 2018 under a different name, File My Return.
Learn here why the results are insignificant, especially when compared with those produced by the CVITP. It is also far less cost efficient in producing results than the CVITP. Furthermore, we show why the service does not live up to its stated promise of helping Canadians who have not filed in the past to access their benefits. It is important to recognize the limitations of SimpleFile by Phone because, as will be seen in the third article, this is also part of the CRA’s pilot aimed at launching automatic tax filing.
Why We Doubt The CRA’s Results From Its Non-filers Initiative
In our most recent article on the CVITP’s coverage of the impoverished in Canada, we concluded that the CVITP remains a very effective program for helping those on low and modest incomes to file their income tax and benefit returns, thereby getting the benefits to which they are entitled. We also noted that the Canada Revenue Agency (CRA) should redouble its efforts to expand the CVITP as most Canadian residents living in poverty still do not benefit from this free service.
Yet we noted that post-pandemic, the CRA appears to have scaled back its ambitions for the CVITP. The CRA no longer sets any targets for reaching more clients. Presently, it is unclear what its goals for and commitments are to this program.
Instead, the CRA seems to be focusing its efforts on reaching Canadian residents on low and modest incomes through three other initiatives: non-filers benefits letter initiative, SimpleFile by Phone (formerly File My Return) and the piloting of automatic tax filing.
In a series of three articles, we show why these three initiatives presently show less promise than the CVITP in tackling the fundamental problem of helping a greater percentage of Canada’s impoverished residents access the benefits to which they are entitled.
In this first article, we look at what the CRA calls its “non-filers benefits letter initiative” which it has operated for the last seven years to encourage non-filers to submit a return.
Learn here why the results are insignificant, even questionable and bear no comparison with those obtained by the CVITP when it comes to assisting those living in poverty.
What Should The CVITP Do About Any Problems With Ufile?
Have you ever run into problems with the Ufile software which the CVITP Helpline is unable to resolve? In this article, we illustrate this with an example of such a problem. Then we discuss the current procedure our CVITP coordinator suggests we follow when these kinds of problems arise. We explain why we think the suggested procedure is not appropriate. And we offer an alternative way of addressing such problems which we believe is more likely to lead to their resolution.
The CVITP’s 2023 Coverage of the Impoverished in Canada
In the 2022 tax season, the CVITP served only 28% of those living in poverty in 2021. The poverty rate in Canada rose from 7.4% in 2021 to 9.9% in 2022. What percentage of the 3,037,000 adults living in poverty in 2022 were served by the CVITP in the 2023 tax season? Read this article to find out more. Also learn about why we think the Canada Revenue Agency should be doing a lot more to expand the CVITP yet does not seem willing to do so.
The Evolution of the CVITP – 2023 Update
Each year, we present and analyze the Canada Revenue Agency’s data to show how the CVITP is evolving. Using the CRA’s 2023 data, we review the most recent trends in the numbers of people assisted and returns filed as well as in the value generated (results from CVITP service delivery), in the numbers of volunteers and host organizations recruited and retained (CVITP infrastructure supporting service delivery), and in measures of productivity for CVITP service delivery. We also identify two positive and two negative factors which could affect CVITP productivity in the future. Read the summary of our findings as well as the full articles (with data tables and graphs) on service delivery, infrastructure and productivity.
*Watch for a new feature that we will be publishing in the coming months on the Evolution of the CVITP!
What Has The CRA’s Pilot Grant Project Accomplished Between 2021 And 2023?
Did you know that the grant funding the Canada Revenue Agency offered to host organizations is a pilot project, not a permanent feature of the CVITP? This project was planned for three years, running from 2021 to 2023 but has been extended for a fourth year to the end of 2024. In this article, we review how this pilot project was implemented in the three-year period and what it was supposed to as well as what it really did accomplish. We also speculate on what the fourth year is likely to yield in the way of results. We conclude with what we think should happen once the fourth year is completed.
Insights From Visiting 14 Urban Organizations in 5 Provinces
Over the last three years, we’ve visited CVITP host organizations in six cities spanning five provinces. At the risk of overgeneralizing, we see broadly two types of host organizations. They have different objectives which lead to very different practices and sustainability in providing CVITP services. One of the two organizations is more common and serves most of the CVITP’s clients across Canada. Yet it is the weaker of the two types of host organizations. If the Canada Revenue Agency (CRA) wants to expand the CVITP, the current situation presents it with some big operational challenges.
In this article, we outline the main features distinguishing the two types of organizations, show why these differences severely limit the CVITP’s potential for expansion, and suggest some ways in which the CRA could constructively meet this challenge. Find out which of the two types of organizations yours is most alike, see if there are any defining characteristics we’ve missed, and let us know if you agree with our reasoning that this presents a problem for the CRA as well as with our proposed solution for building on these differences to the CVITP’s advantage.
Your Newcomer Clients May Not Be Getting Their Benefits – Here’s Why
Have you prepared a newcomer’s income tax and benefit return recently? When filing the return, you may have told the client this action will automatically trigger the disbursement of benefits to which they are entitled. But you may be surprised to learn that this is not always correct.
Often, the Canada Revenue Agency (CRA) will inform the client that they must first provide more information. Find out here what this information is, why the CRA does a poor job of communicating this to the client and how it could do all this better in two simple steps.
What is the CRA’s new Volunteer Identification Number for?
Early in May, you probably received an email from the Canada Revenue Agency (CRA) announcing that as an approved volunteer with the CVITP, you have been assigned a Volunteer Identification Number or VIN. No information was provided on its purpose other than to say it would allow the CRA to better serve volunteers.
Read here to learn about at least three ways we think it might be used.
Using Municipal Poverty Data to Better Target CVITP Service
In a previous article, we argued that the CVITP is not serving enough of Canada’s poor. In that article, we looked only at the national picture. Under the most generous assumptions, we determined that the CVITP served at best only one in every five poor people in Canada.
In this article, we look briefly at 2020 provincial and territorial level data (the most recent year available) to establish CVITP coverage (again, using a very generous assumption). Our estimates reconfirm that CVITP service to the poor remains surprisingly low across Canada (with the lower populated regions doing a comparatively better job).
Given the CVITP’s very limited delivery capacity, we believe that the best way to serve more of the poor is with better targeting. But to do this effectively, host organizations need poverty data at the local level. By this we mean both reaching out to specific groups to encourage them to use the service and greater selectivity in whom the service is provided to.
A new Statistics Canada website where poverty data for most Canadian municipalities can be found offers the CRA and host organizations the information needed to devise strategies to improve access to CVITP services for those who need it the most. But we argue it is unclear whether either group has the will to make this happen.
How to Reduce the Number of Chronic Non-filers by Using the CVITP Better
In the first article in this three-part series, we argued that while the number of current non-filers may not be as large as some popular estimates, the number is still very large and represents a serious drag on achieving the federal government’s poverty reduction objectives. In the second article, we focused on recent non-filers, those who forget to file, file late, or skip one or two tax years. Most importantly, these clients have a current mailing address on file with the CRA, enabling the CRA to communicate with them. We looked at the non-filers benefits letter campaign and the forthcoming automatic filing pilot project to see how the CVITP could help to enhance the performance of these two initiatives.
In this third and final article, we look at the situation of chronic non-filers, those who have not filed for many years and make up the majority of estimated non-filers. The CRA’s chief problem is that it does not have current mailing addresses for these clients. Therefore, it has no way of communicating directly with them. Yet this is the group the CRA should be trying to make progress in reaching if it is to substantially increase its coverage of poverty reducing benefits.
This article focuses on ways we think the CRA could also make use of the CVITP to target chronic non-filers. To do so successfully, it will have to meet two pre-conditions. First, it will have to become less reluctant to taking direct action in providing strategic direction and strong managerial support to the CVITP. Second, it will have to change its vision for the CVITP from a free tax return preparation service to one that also includes helping low-income residents maintain their access to important poverty reducing benefits.
Assuming the CRA can meet these two conditions (and we acknowledge this is a big assumption), the article looks at ways it can better invest in its two partners to reach and effectively serve chronic non-filers. With respect to community-based organizations that host CVITP clinics, we make suggestions to the CRA for changes to its funding formula, for providing data to improve client service and reporting on impact, and for assisting with coordination efforts. We also have suggestions for the CRA regarding its other CVITP partner, volunteers; these cover their recruitment, training, supervision and support, and recognition and retention.
Finally, we close the article looking at how the CRA can better track its progress in contributing to the reduction of poverty through the CVITP by using more appropriate indicators than those it currently reports against.