Description: Have you ever heard of tax expenditures? Maybe you know them by some of their other names, such as the Public Transit Tax Credit or the Children’s Fitness Tax Credit. These tax subsidies, offered to select groups of Canadians – often those in higher income groups – tend to fly under the radar. Unlike normal program expenditures, the government doesn’t write a cheque to accomplish the policy objective; it simply passes a law to grant a tax break. And these tax expenditures don’t have to be voted on each year when Parliament approves the budget, so citizens and Members of Parliament don’t really know the value of government policy being carried out through them year after year. What type of sums are involved? – In 2009 the Parliamentary Budget Officer estimated tax expenditures at over $100 billion per year.
Date: March 8, 2016
1) Were you aware of the concept of tax expenditures? What do you think of this approach to government policy?
2) If you were the comptroller for a Canadian government, what would you recommend to disclose tax expenditures in the government’s financial statements?
3) What strategies could citizens and Parliamentarians employ to ensure tax expenditures are properly disclosed?