June 26, 2023

---

Those who have visited this website before may know that we produce an annual update called the Evolution of the CVITP.  This tracks CRA data for the CVITP on the numbers of individuals assisted and returns filed (what we call the CVITP results) as well as volunteers and host organizations (what we call the CVITP infrastructure).  In the past, it has often been difficult to find the data as it has been spread out through various CRA publications and press releases.

That has now changed with the CRA publication of 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 benefits generated.  It provides this data at the national level as well as broken down by provinces and territories, something 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.

1. Change in the timeframe for data collection

Until now, whenever the CRA has reported annual CVITP data, it has used the period of May 16 from one year to May 15 of the next year to define the twelve-month period.   The new feature uses January 1 to December 31 as the twelve-month period.  We think this change makes sense as the data now corresponds better with the tax season which runs from approximately February 20 to January 31 of the next year.

However, it does create a discontinuity with prior data making it potentially problematic to compare this data with data from 2021 and subsequent years.  Of course, the CRA could solve this problem by publishing pre-2021 data using the new January to December timeframe, and we encourage it to do so.

In the meantime, this discontinuity is manageable.  Here is how the new CRA data reported for January 1 to December 31 compares with the data the CRA previously reported using the May 16, last year to May 15, current year for the two overlapping periods.

The data for 2021 (January 1 to December 31) are remarkably similar to the data reported for what was previously 2022 (May 16, 2021, to May 15, 2022).   The data for 2022 (January 1 to December 31) leads to only one change in our previous assessment of six trends revealed in CVITP data:  the numbers of individuals assisted and returns completed rose by 13% and 15% respectively in 2022 whereas the old data suggested stagnating performance.

2. Value of refund, credit and benefit entitlements

For many stakeholders (host organizations, donors, the public), this information highlights the relevance of the CVITP in getting money into the hands of low-income individuals and thereby helping to reduce income-based poverty.  Publication of this data is long overdue.

As one footnote explains, “[a]mounts are from federal and provincial refund, credit, and benefits administered through the CRA.”   A breakdown of what is included in credits and benefits would provide for greater transparency and understanding.

We suspect the total figure given by the CRA for the year does not include the Guaranteed Income Supplement (GIS) nor any of the provincial and territorial supplemental income benefits (such as the Guaranteed Annual Income System or GAINS payments in Ontario, the New Brunswick Low Income Seniors Benefit payments and the Nunavut Seniors Income Assistance or NSIA payments).  This is because these are not given as estimates in the return (unlike the GST credit, for example).  Instead, they are calculated by Employment and Social Development Canada (in the case of the GIS), the province or territory for the next twelve-month period based on information contained in the individual’s most recent income tax and benefit return.

Yet, the individual can only get them if they are up to date in filing their returns.  Therefore, this is a benefit entitlement which the individual receives only because they have received CVITP assistance in filing their returns.

When we advise host organizations on the calculation of benefits generated for their CVITP clients, we recommend that the clinic coordinator include the GIS and provincial or territorial supplemental income benefits individuals received during the last tax year.  It is important to include this information as it often totals a very large amount.

Clinic coordinators will already have this information as it is included in the T slip information collected by volunteers for the preparation of the returns.  It is a proxy – it is not an accurate estimate.  For some individuals whose income have been higher than anticipated last year, the GIS and provincial or territorial supplemental income benefits will decline; in these cases, using last year’s data will overestimate the amounts.  For other individuals, it will be the reverse; in these cases, using last year’s data will underestimate the amounts.  For most individuals, it will likely remain unchanged – except that these supplemental benefits will increase modestly where they are indexed to inflation.  And for those individuals who reach the age of eligibility in the year when they file, there will be no prior year’s data on supplemental benefits.  Thus, the overall estimate host organizations come up with will inevitably be an underestimate.  But it is more informative than to exclude it entirely.

We also suspect that the total figure given by the CRA for the year does not include several one-off payments that the federal government makes which are not estimated in the return, but which are dependent upon filing.  For example, in the fall of 2022, recipients of the GST credit received a one-time supplementary payment.  Again, in July of 2023, recipients of the GST credit will receive a one-time payment, called the grocery rebate, to partially offset spiralling costs on their food bills due to inflation.

If our suspicions are correct, this means that the CRA figure for the benefit entitlements generated for clients from filing their returns through the CVITP is a very conservative estimate of the direct benefits.  Host organizations and volunteers will know that there are also incalculable indirect benefits derived from filing these returns.  Examples include the use of information in the Notice of Assessment to calculate eligibility for the Canada Learning Bond and to estimate the rent subsidies provided for social housing in several provinces and territories. 

3. Refund, credit and benefit entitlements by host organization

For many stakeholders (host organizations, donors, the local community), information on refunds, credits and benefit entitlements generated by the CVITP at the national and provincial or territorial level is interesting but not very relevant to their situation.  What they really want is this information for the clients they have served in their own CVITP clinics.

For clinic coordinators, such information demonstrates the relevance of their work to senior management within their host organizations and to their local communities.  It also helps to buttress their requests to donors for funding support (as the grants provided through the CRA’s pilot project do not come close to meeting the costs incurred by most host organizations’ costs offering CVITP services).

The introduction of the CVITP Organization Identification Number or COIN in 2021 (for 2020 and subsequent year returns) now makes it possible, in principle, for the CRA to collect and provide this data for all the 2020 and subsequent year returns filed by any CVITP host organization.  The CRA should waste no time in making this information available to any host organization that requests it.

4. Tracking and reporting on more meaningful results

The risk here is of reporting on what is easiest to track, but not what is most important. While tracking the number of individuals assisted, returns filed, volunteers, host organizations and benefits generated is useful, these results are suggestive but do not really reflect the main purpose of the CVITP.  (We show why here.)   The CRA should track and report against more relevant results, which can help it to focus limited CVITP resources, especially its volunteers, on providing CVITP services to those who need these the most.

There are four questions which the CRA should be answering by monitoring and reporting on the relevant data in any given year:

Results from combinations of the answers to these questions can provide meaningful guidance on shaping targets and reforms that will improve national performance.  Results at the subnational level can also help guide strategic decisions about CVITP reform efforts at that level.