The taxman's on strike. Earlier this week, the Public Service Alliance of
Canada and the Canada Revenue Agency were unable to reach an agreement on wage
increases by their strike deadline and employees have currently begun rotating
strikes. On Wednesday, approximately 8,000 employees walked off the job in
Ontario and in British Columbia. The strike could ultimately affect up to 22,000
of the agency's permanent employees.
In a press release, the government stated that "the CRA remains committed to
providing the best possible services to Canadians, but in the event of a strike,
some of these services could be affected."
To avoid mass chaos and financial hardship for many Canadians, the CRA has
designated certain key positions as vital to ensure the delivery of "essential
activities."
These activities include the issuing of the Canada Child Tax Benefit (the
next issuance date is Sept. 20), the issuing of the GST/HST Credit (Oct. 5), the
processing of objections relating to eligibility for the CCTB or the GST/HST
Credits and the handling of rulings and appeals relating to entitled to
Employment Insurance benefits and payments under the Canada Pension Plan.
The biggest disruption would likely be at the various tax services offices,
depending on whether the union calls a full or rotating strike. The CRA
recommends heading to its Web site (www.cra.gc.ca) to get tax information during
the strike.
For taxpayers required to pay their taxes in quarterly installments, the most
recent instalment reminder was sent out in August.
Unfortunately, taxpayers are still responsible for meeting the CRA's Sept. 15
and Dec. 15 installment deadlines, even if no one is around to cash the cheques.
If you owe other money to the CRA, as long as payments are received by the
due dates, no interest or penalties will apply, despite the fact that there may
be a delay until such payments are actually processed.
During a previous CRA strike, some employees threatened to assess certain
taxpayers based on the letter of the law rather than its spirit. Presumably, the
CRA would ultimately agree to waive any penalties and interest you were assessed
as a result of the failure to file a tax return on time because CRA picketers
were blocking the entrance to your local Taxation Centre.
Waiting for a tax refund? Bad news -- your refund may be delayed due to a
strike action. Visitors to Canada who applied for a GST Visitor Rebate may also
have to wait longer for their refund cheques to arrive.
Taxpayers who have an objection or appeal outstanding with the CRA may be the
most inconvenienced. The CRA has indicated that these types of objections or
appeals have not been designated as "essential" and may be affected.
The bottom line, according to the CRA, is that "Canadians continue to be
responsible for meeting their tax obligations." Perhaps slightly ironic is the
fact that union members who are on strike and who receive "strike pay" can
receive the money tax-free. This is a result of the Supreme Court of Canada's
1990 determination that, under the Income Tax Act, strike pay is simply not
"income from a source" and therefore, escapes taxation completely.
Now, if only us taxpayers could go on strike as well.