As Thursday’s tax filing deadline nears, many procrastinating Canadians are feeling the pressure to gather all their information and start crunching the numbers.
A new Fraser Institute report suggests tax filing is not only time-consuming, but also complex and costly.
The think tank estimates that complying with Canada’s tax system adds up to about $6 billion in direct and indirect costs for families and businesses. The costs include spending on accountants, lawyers and tax filing software as well as the cost of time spent gathering all materials to complete the forms.
The study also finds that Canada’s tax system has become more complex over time.
The number of credits, deductions and exemptions increased 22 per cent between 2001 to 2014, while the size of the federal income tax guide grew 25 per cent.
“A worthwhile goal is to simplify the tax system, making it easier to understand and less expensive in time and money,” said report co-author Charles Lammam, director of fiscal studies at the Fraser Institute.
Last week, the federal government introduced a number of new tax measures in the 2015 budget including a home accessibility tax credit for seniors, income splitting for couples and a doubling of the universal child care credit.
A recent H&R Block survey found that one-in-five Canadians does their taxes last minute. Many said there are a lot of unattractive alternatives they’d rather face. One in five said they’d rather get a flu shot and nearly one in ten said they’d rather sing karaoke in front of their boss.
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