Michael J.S. Beauvais is a researcher at McGill University’s Centre of Genomics and Policy, where he specializes in data governance and privacy law.
In the past week I received the Canada Revenue Agency’s 2020 Federal Income Tax and Benefit Guide in the mail. The reason? Due to privacy concerns, I am part of a dying breed that files their tax returns on paper.
As a digital native, I am an unlikely candidate to file my income tax returns this way. Indeed, I want to file digitally. But filing digitally forces taxpayers into dealing with intermediaries in a marketplace with competing products.
This year more than others, the numerous programs launched by the CRA and other agencies as a response to the social and economic consequences of the pandemic underscore the immediate role government can have in supporting citizens.
Yet, despite the unparalleled importance of taxation in our current circumstances, the CRA continues to treat taxpayers as consumers rather than citizens.
There are currently 39 different products for online tax filing, putting the burden of figuring out which ones take our privacy seriously on citizens. Making an informed choice requires reading through long, vague and often confusing policies. Research consistently shows that, despite their privacy concerns, many Canadian consumers do not read the privacy policies of the companies that handle their personal data. Far fewer are likely to understand these “incomprehensible disasters.”
The CRA’s decision to leave digital filing to the private sector transforms taxpayers from citizens into consumers in a captive market.
The reliance on private companies also makes a mockery of the CRA’s own Taxpayer Bill of Rights, which guarantees the privacy of our personal information.
Taxpayers are entitled to trust that their personal information will not be sold to the highest bidder by online filing products provided by private companies. Taxpayers are entitled to expect that they can file their tax returns digitally and directly with the CRA.
The recent draft Consumer Privacy Protection Act (CPPA) will not fix this issue, either. Under the CPPA, these companies will still be able to collect your data and share it with others. Yes, they will need to be clearer when obtaining your consent to do so. But what does consent mean when the CRA forces taxpayers to engage with private companies when filing digitally? The gathering and selling of our personal information by companies occurs in a wider context; privacy laws alone cannot remedy the inadequacies of a market-based status quo that is at odds with a robust notion of citizenship.
We need solutions that go to the heart of the issue. All taxpayers are entitled to interact directly with the CRA as bona fide citizens. Doing so requires a vision and plan for innovative government services for the 21st century. We have a choice: we can continue fumbling along through measures such as CRA’s entente with Tax Filers Empowerment Canada (TFEC), which partially gave us this unimaginative, industry-friendly status quo; or we can develop innovative digital government services that are committed to treating everyone as a citizen and responding to their concerns, be they privacy-related or otherwise.
The boldest move would be to adopt a return-free filing system, alluded to in this past autumn’s Speech from the Throne. Under this system, most taxpayers in Spain, Sweden, New Zealand and elsewhere do not need to file a return at all – obviating the need to interact with and disclose personal information to private companies. At least 36 countries have return-free filing, according to the Tax Policy Center, a think tank associated with the Urban Institute and the Brookings Institution.
More modestly, the CRA’s online portal should be expanded to allow most taxpayers to input their information directly with the CRA.
Taxation plays a key role in creating the society we want. The way citizens engage with the tax system says much about who we are as a country. Now is the time for fresh ideas and a renewal of our commitment to citizenship.
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