An important experiment is beginning in documenting the administration and content of Canadian income tax law. The experiment is called taxwiki.ca. What is this experiment, and why is it necessary?
The Office of the Auditor General recently pointed out that there is insufficient accurate guidance being provided to Canadian taxpayers by the Canada Revenue Agency (CRA). To support this claim, the Auditor General's report highlighted that the interpretation bulletins issued by the CRA are accessed frequently by Canadians (1.5 million times from April 2008 to March 2009) and that, “Most tax auditors and many tax practitioners told us that they begin their research into a legislative interpretation question with Income Tax Interpretation Bulletins as their source of guidance.”
Obviously, then, the bulletins are an important source of tax information for taxpayers and their advisers.
Despite the high visibility and degree of attention paid to the interpretation bulletins, however, the CRA admitted in its response to the criticisms of the Auditor General that updating or maintaining the bulletins “is not a priority, in part due to resource constraints.”
That updating this guidance is not a priority is borne out by the fact that despite their being nearly 300 IT bulletins, in the past six years only 29 have been revised and only a single new one has been issued. Many of the outstanding bulletins are now at least partly obsolete.
The Auditor General recommended that, “The Canada Revenue Agency should improve the information it provides to users about specific paragraphs in Income Tax Interpretation Bulletins that are no longer accurate, so that they can more readily comply with the Income Tax Act.”
The CRA responded that, “The Agency provides taxpayers and tax practitioners with up-to-date technical information such as pamphlets, guides, tax return packages, technical opinions and conference responses. Given that there are several other mediums that provide this type of technical information, the Agency may opt to cancel its inventory of Interpretation Bulletins.[…] the Agency will evaluate this option during 2010 and ensure practitioners are consulted and aware of any subsequent plan of action to either update […] or cancel them.”
It is odd that the solution recommended by the Auditor General is to flag the obsolescence of the interpretation bulletins rather than update them. It is equally odd that the CRA’s idea is to consider eliminating a major source of taxpayer information.
The interpretation bulletins get 1.5 million hits per year online. It is difficult to imagine how eliminating the interpretation bulletins could lead taxpayers to “more readily comply with the Income Tax Act."
The taxwiki.ca response is to establish a publicly-accessible and editable “wiki” of current “interpretation bulletins” and other tax materials. These are not, of course, official CRA interpretations bulletins, but they would initially use as “seed” materials the current stock of bulletins. These are edited and refined by expert users, with the goal of providing an unofficial and publicly beneficial forum for making known the current views of the CRA and the demands of Canadian income tax law.
In principle, of course, there is no reason to stop at interpretation bulletins. The future may bring user-edited guides on many aspects of income tax law and administration that go far beyond what is within the ambit of that offered historically by the CRA. That is up to the collective wisdom of the users of taxwiki.ca.
The site may also prove to be pedagogically useful, with students directed to the site to peruse the bulletins relevant to course coverage, and courses may be structured to open the possibility for students to earn credit for participation by contributing their research efforts to maintaining the currency of the information on the site.
In short, the experiment has begun. Follow it in progress at http://www.taxwiki.ca
