Department of Finance Releases Annual Report on Federal Tax Expenditures
February 23, 2016 – Ottawa, Ontario – Department of Finance
The Department of Finance today released the 2016 edition of the Report on Federal Tax Expenditures—Concepts, Estimates and Evaluations.
This report, formerly called Tax Expenditures and Evaluations, provides estimates of the fiscal cost of federal tax measures designed to ensure the proper functioning of the federal tax system and support the economic and social priorities of the Government of Canada.
Many improvements to the design and content of the report have been made to this year’s edition to make it more useful to readers and to respond to feedback received from parliamentarians, the Auditor General of Canada and other commentators. These improvements include:
- Fiscal cost estimates for additional years, as well as greater detail on the approaches used in developing the estimates; and
- More background information on each tax expenditure, such as descriptions, objectives, historical information, and references to related federal spending programs.
In addition, the online presentation of the fiscal cost estimates has been improved to help individuals to access and use the information, which can now be downloaded in a database format. This information will be updated every year, and will provide a convenient and easily accessible reference for information on federal tax expenditures.
The companion document, Tax Expenditures: Notes to the Estimates/Projections, which had been published occasionally since 2000, will no longer be published. Instead, its contents have been integrated into today’s single report, and will continue to be published in this manner in the future.
Today’s report also includes two analytical papers. One provides a profile of claimants of the Working Income Tax Benefit. The other is an evaluation of the response of individuals to changes in tax incentives for charitable donations.
The release of today’s report coincides with the tabling of the Main Estimates in the House of Commons by the President of the Treasury Board, providing Members of Parliament with comprehensive information about federal tax expenditures.
- The Government of Canada first reported on federal tax expenditures in 1979. It has published estimates of tax expenditures for personal and corporate income taxes, as well as for the Goods and Services Tax, since 1994.
- The Government’s Report on Federal Tax Expenditures—Concepts, Estimates and Evaluations is an annual publication that provides important information on the objectives, design and cost of federal tax expenditures.
- Over the years, this report has become a key component of the Government’s reporting on the federal tax system, contributing to the public dialogue on federal tax policies.
- Tax expenditure reporting is considered an international best practice to foster government budgetary and fiscal transparency.
- International organizations have recognized the quality of Canada’s reporting on federal tax expenditures, notably with respect to the number of tax measures and years for which cost information is presented, the detailed methodological information provided, and the publication of evaluations and analytical papers.
Office of the Minister of Finance
Department of Finance