Big Disclosure Issues in Proposed Change to Income Tax Act

Currently the Income Tax Act (the Act) ensures disclosure of taxpayer information by Canada Revenue Agency (CRA) officials is specifically prohibited unless in relation to a criminal investigation or in emergency circumstances.

But a proposed amendment to the Act would give CRA auditors the right to disclose taxpayer information to police without a warrant or any notification to anyone; a provision that has Canada’s Privacy Commissioner concerned, as reported by the CBC last week.

The provision is well buried in a 375-page omnibus budget bill as a proposed amendment to the Act. It expands the justifications through which CRA officials can disclose information, especially in cases where CRA auditors have uncovered evidence of drug trafficking, terrorism, child pornography, and contracts for the commission of murder — and have been unable to pass on this information to law enforcement, according to a CRA spokesperson; all of which sound like valid concerns.

But, Chantal Bernier, Canada's interim privacy commissioner, told CBC news that there needs to be a proper oversight mechanism in place, especially in lieu of any requirement to go through the courts.

"Obviously tax data can be relevant to criminal investigations," she said. "But there's a process to disclose and we would like to know why this provision would create an exception to that process."

These proposed changes should be carefully debated — how will they impact a self-assessment system that has worked quite well up until now? Will they increase public safety and policy, and if so, at what cost to the integrity of our self-assessment system? Should CRA be given these powers without due process? Your views are welcome – visit our Facebook page and let us know your thoughts.