Canada's 'completely nuts' tax code could complicate automated filing plan: watchdog

Canada's 'completely nuts' tax code could complicate automated filing plan: watchdog

Taxpayers' ombudsperson sees highest number of complaints in 3 years

Taxpayers' Ombudsperson François Boileau is pushing for simplified, automated tax filing as his office faces the highest number of complaints in three years.

Boileau released a new report on Tuesday showing his office saw a 27 per cent year-over-year jump in complaints in 2025-26, driven mainly by Canadians upset with Canada Revenue Agency service delays.

His report offers seven recommendations to improve CRA's services — including one to allow Canadians to request a callback without calling a centre first.

The report cites Prime Minister Mark Carney's government-wide directive to spend less on day-to-day operations and says reforming CRA's services would save money.

"The CRA needs to fast-track automation to not only deliver cost savings, but also ensure it is reducing delays to deliver the service taxpayers expect," the report reads.

Boileau's office calls on Ottawa to expand its automatic tax filing pilot to all individuals "in a simple tax situation," not just those with low incomes. An example of someone with a simple tax situation would be a retired senior on a fixed income, Boileau said.

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The federal government relies heavily on the CRA to deliver income-tested benefits to individuals — so those who don't file their tax returns could be missing out on critical benefits.

Automatic tax filing — already the standard in the United Kingdom and New Zealand — was first promised for Canadians in the Liberal government's speech from the throne in 2020.

The government took steps to simplify tax filing for thousands of low-income households in 2024. It offered a SimpleFile option for eligible households to auto-fill parts of their tax returns online or by phone.

The Liberals announced in Budget 2025 they plan to offer pre-filled tax returns that Canadians with simple tax situations can review in their CRA accounts starting next tax season. The program would start with one million taxpayers next year and scale up to 5.5 million by 2029.

Asked Tuesday about the CRA's push to roll out automatic tax filing, Boileau said the size and complexity of the Income Tax Act could pose a barrier.

"It's completely nuts. Maybe it's time to streamline a little bit," he said.

Boileau said Tuesday that Budget 2025 was "a good step" toward simplified tax filing but he's pushing to see if Ottawa can do "a little bit more."

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John Fragos, spokesperson for Finance Minister François-Philippe Champagne, said in a statement to The Canadian Press that scaling up automatic tax filing will help Canadians get access to the benefits they're entitled to while safeguarding confidential taxpayer information and improving tax fairness.

He pointed to Ottawa's demand that the CRA impose a 100-day plan to improve services for Canadians this past fall as proof the federal government is dedicated to improving the way Canadians interact with the tax system.

Boileau told reporters the 100-day improvement plan lit a fire under the CRA, leading it to adopt some of his office's previous recommendations, like a callback program. He said this approach shifted the usual accountability from politicians to the bureaucrats themselves.

Boileau said he wants to keep that going. He wants to see monthly or quarterly reporting from the agency on how its processing times are measuring up to service standards.

Boileau also said the CRA could make better use of AI chatbots to answer taxpayers' questions online. He said he wants to ensure AI is used equitably and that human agents are still the ones making decisions on Canadians' tax accounts.

So far, he said he's reassured by the CRA's "very ethical" approach to using artificial intelligence.

"Whether I like it or not, it's the way of the future," Boileau said.

"If it can help contact centre agents to have a better understanding of the issue at hand and what has been said consistently with other similar situations, that might be helpful."

Craig Lord is a reporter with The Canadian Press.