A recent article looked at disparities in access to free CVITP services between the provinces in the 2021 tax filing season. This article updates the 2021 findings on inequalities of access to CVITP services across Canada for the 2023 tax filing season. The results are disappointing but contain at least one surprise. Read here to learn the results.
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.
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.
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.
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.
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.
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!
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.
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.
In our first article in this 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 this second and the next article, we show how the Canada Revenue Agency (CRA) could make better use of the CVITP to reduce the number of non-filers more effectively than its current efforts.
This second article deals with recent non-filers, those who forget to file, file late, or skip one or two tax years. Most importantly, the CRA can still communicate with these clients as it has their current mailing addresses.
We focus on two initiatives. The non-filers benefit letter campaign has been operating since 2016. (We have previously reviewed this initiative here.) We suggest providing letter recipients with the name, address and phone number of the closest CVITP host organization where they can get their returns done for free, and informing these organizations of the names and addresses of letter recipients who have been referred to them. This may improve the rate at which letter recipients, most of whom are recent non-filers, respond.
The automatic filing of income tax and benefit returns will be experimented with starting next year. (We recently reviewed this new initiative here.) Some traditional CVITP clients may receive a pre-populated return from the CRA to review and send back, confirming the information contained in the return is complete and accurate. Should they have any questions about their return or the process, some clients receiving such a return may not own a phone with which to call the CRA. Others may not trust the CRA to provide clear answers to their questions. Yet again others may not understand what is being asked of them. To increase the success of this initiative, we recommend involving CVITP host organizations and their volunteers to help answer questions these clients may have. While these clients are unlikely to be non-filers, if this initiative is successful, it will reduce the number of traditional CVITP clients thereby freeing up CVITP capacity to take on new clients, some of whom may not have filed a return in many years.
Neither of these initiatives is likely to substantially reduce the number of what we call chronic non-filers who make up the majority of 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 inroads with if it is to substantially increase its coverage of poverty reducing benefits. We believe the CRA could also make use of the CVITP to reduce the number of chronic non-filers. This will be the subject of the third and final article in this series.
The CRA recently published a new feature on its CVITP website called “Free tax clinic statistics”. This feature includes annual data on individuals assisted, returns filed, volunteers and host organizations as well as the value of the entitlements generated by filing returns. It provides this data at the national level as well as by province and territory, something that was rarely seen before. This is a very welcome development!
While the website only gives data for 2021 and 2022, we hope the CRA will update this feature in future years without losing the historical data. Considering this new feature, we list four concerns below, in order of priority, from least to most important:
This article provides the numbers and more detail on the concerns listed above.
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In this series of five short articles, we show how the CRA has publicly scaled back its growth ambitions for the CVITP. We cover four distinct periods in the evolution of the CVITP over the last 10 years:
Given the history of CRA’s changing ambitions for the CVITP, we draw three conclusions:
There comes a time in every volunteer’s work where they need to get on the phone with the client and call the Canada Revenue Agency (CRA) CVITP Helpline. The Helpline is, in principle, a really good innovation which delivers expert advice efficiently. But more frequently than we would like, we have an experience which reminds us just how incredibly difficult it can be for some clients in communicating with the CRA. The barriers to client identification can be onerous, even for a client who is very well prepared going into the call.
Too often, the call’s success depends on the CRA agent who takes the call. The CRA agent first needs to ascertain that the client is indeed who they say they are. To do this, the CRA agent will ask for information on the client’s file which the client should know. Some CRA agents appear to detect from the way they answer that the client is likely to have problems with some of these questions. So, the CRA agent goes out of their way to permit the call to proceed. But this is not always the case.
Where the client fails to convince the CRA agent of their identity, the CRA agent will terminate the call. Often this results in the client being scared away from calling the CRA again. The client may also lose faith in the competence of the volunteer, thereby damaging the reputation of the host organization.
Our article outlines a proposal which builds on the security mechanisms the CRA currently uses for the CVITP. In addition to explaining a simple procedure which could be used to avoid the release of client information under fraudulent circumstances, we give a few considerations which should be taken into account when assessing our proposal.
Ultimately, we believe the CRA needs to place more trust in the rigorous security and confidentiality procedures it already has in place for the CVITP. Adopting our proposal, or something very much like it, would go some way toward reducing client stress and increasing the efficient use of CRA and CVITP volunteer resources.
In the first article in this series, we argued that the CRA’s existing non-filer benefits letter campaign was not effective. In the second article, we reviewed a recent Auditor General (AG) of Canada report on the efforts of Employment and Social Development Canada (ESDC) and the CRA to help those in hard-to-reach populations who are non-filers to access benefits. We concluded that the CRA does not know the size of the non-filer problem and, worse still, has done little to better inform itself.
The focus of our third article is on outlining some solutions to this problem.
The CRA believes that a lack of awareness about the benefits of filing is a key obstacle and has a number of outreach activities designed to address this problem. Ironically, research commissioned by the CRA itself contradicts this; it identifies the main obstacles to be ones that the CVITP has already been designed to address.
In the AG’s report referred to above, the AG noted that the CRA and ESDC both have extensive outreach activities employing thousands of volunteer organizations across the country to target these same populations, but that the CRA and ESDC needed to adopt an integrated approach for people requiring extra help. Closer collaboration by the CRA with ESDC could prove beneficial as ESDC’s competencies in working with community-based organizations could help the CRA to introduce better practices within the CVITP.
But even in the absence of strong collaboration, the CRA could still be doing more to help hard-to-reach populations to file their returns, in particular by making better use of the CVITP. At present, the CRA seems to be counting principally on its three-year pilot grant program to build CVITP capacity by recruiting and retaining host organizations. We remain sceptical that this program will genuinely increase the number of host organizations providing CVITP services.
The CRA cannot simply bet on strengthening CVITP capacity by increasing the number of host organizations and volunteers. It also needs to make more efficient use of its existing CVITP host organizations and volunteers, ensuring that this infrastructure provides services to those who need it the most. In particular, we have highlighted the importance of undertaking data analysis to inform the CRA’s strategic choices and have given specific examples to illustrate how this could be done.
In our review of the three-year pilot grant program when it was first introduced, we also illustrated how data analysis could be used specifically to inform choices about funding, including offering a larger financial incentive for returns filed by clients who had previously not filed for a number of years. After the 2023 tax season, the CRA will be reviewing the implementation of its three-year pilot grant program. Assuming it retains a modified grant program thereafter, it could include more generous grant payments for each return a host organization files for the 2020, 2021 and 2022 tax years with the highest payments for the oldest returns.
We close our third article in this series admitting that CRA money alone will not solve the problem of non-filers. However, ESDC could play a larger role. We will return to this in a future article, examining some of the ways in which ESDC could collaborate with the CRA in supporting the CVITP.