The Throne Speech commitment about automatic tax filings continues to make waves, particularly because it’s such an important component about ensuring that government benefits go to those who need them, and how it’s not happening currently. With that in mind, here’s Dr. Jennifer Robson with some additional context as to why this is a problem and why it’s a good thing the government is finally proposing to act on it.
In a paper out now in @canpublicpolicy, @saulschwartz & I estimate the share of Canadians who don't file a tax return, describe who they are and add up the benefits left on the table by non-filers. This builds on earlier work, i.e. this for @prospercan: https://t.co/kOUN3MvM6S pic.twitter.com/hhsw0YArtY
— Dr. J Robson (@JenniferRobson8) September 27, 2020
StatCan uses tax data to fill in income values in most surveys now. We deem someone a non-filer if that matching fails. There will be error (person filed but gave bad matching info on the survey; no SIN found so no match possible). Note: if no SIN, how likely is it they file?
— Dr. J Robson (@JenniferRobson8) September 27, 2020
Non-filing is more frequent for people below the poverty line. pic.twitter.com/PY5yAiFWPm
— Dr. J Robson (@JenniferRobson8) September 27, 2020
Next, we look at the $ values of cash benefits that non-filers would be missing. Note: we look at just 3 groups of benefits (GST credit, child credits, CWB) and using the 2015 benefit values. These benefits have increased in value since (esp child benefits). pic.twitter.com/nOhjV6SYd4
— Dr. J Robson (@JenniferRobson8) September 27, 2020
But even small amounts add up. We give a conservative estimate of $1.7B in benefits unpaid due to non-filing. We also talk about potential implications for accuracy of admin data that sets poverty lines, models policy impacts, etc..
— Dr. J Robson (@JenniferRobson8) September 27, 2020
If $4,200 isn't enough to induce someone to file, then maybe we have a broader problem that information alone isn't going to fix.
Anyway, here's a link to the full paper: https://t.co/Z58uYu7BTQ— Dr. J Robson (@JenniferRobson8) September 27, 2020