With the tax deadline in the rear-view for many Canadians, no one is jumping up to talk about taxes. After all, many Canadians have a scarring experience with the CRA. The hours on hold. The number that changes every time you check the website. The form that doesn’t match what an agent told you the week before. It’s incredibly frustrating.
Enter the taxpayers’ ombudsperson, the independent officer appointed by the federal government to examine service-related complaints about the CRA, who just released his annual report. Some lowlights:
- Complaints to his office jumped 27 percent in 2025–26, the highest level in three years.
- Processing delays were the single largest driver of complaints, outranking all other categories.
- T1 adjustment requests that are supposed to take 20 weeks under CRA’s own service standard were taking up to 50 weeks.
None of this should surprise anyone who has dealt with CRA directly.
The auditor general’s scathing audit last year of CRA’s contact centres explains why. CRA fielded more than 32 million calls in 2024–25, and agents managed to answer just over 10 million of them, meaning callers had around a one-third chance of even reaching a person. To manage the volume, the agency redirected 8.6 million of those calls to its automated system instead of giving callers the option to speak with someone at all. If you avoided automated deflection and got through, you waited an average of 31 minutes—nearly double the wait from a year earlier—and only 18 percent of calls were answered within CRA’s own 15-minute standard, down from 49 percent the year before.
When auditors tested agents directly with general individual-tax questions, the accuracy rate came in at a dismal 17 percent. Some of that traces back to how CRA grades its own staff: accuracy and completeness count for just 9 percent of an agent’s performance score, while sticking to a schedule and handling calls quickly count for 45 percent. Even CRA’s own chatbot got only two of six test questions right, while competing AI tools answered five of six correctly.
What might surprise you is that this happened despite CRA’s workforce growing roughly 31 percent in a decade, from about 40,000 employees in 2015 to 52,500 in 2025 (the peak was 59,200 in 2024). Indeed, a larger payroll has yielded a less responsive agency.
i
Graphic Credit: Janice Nelson.
To address this, the Carney government announced a 100-day service improvement plan, launched last September. It has delivered modest gains: extended chat hours, a callback pilot, and CRA’s first public reporting on call centre performance.
The ombudsperson himself flagged that kind of transparency as central to rebuilding accountability. But he’s also clear that short-term fixes aren’t enough and that sustainable progress needs medium and long-term solutions.
In my view, CRA’s execution is only part of the story. The bigger issue is what Ottawa keeps asking CRA to administer in the first place.
View reader comments (6)
Over the past decade, federal tax policy has piled on complexity. A capital gains inclusion rate hike that was announced, fought over for a year, then reversed. Bare trust reporting rules introduced, then suspended. New Base Erosion and Profit Shifting (BEPS) and Excessive Interest and Financing Expenses Limitation (EIFEL) rules layered onto cross-border transactions. An Alternative Minimum Tax overhaul. A growing thicket of targeted credits for favoured sectors. And the list goes on and on.
The tax system has become so complicated that the government doesn’t always know how to administer it.
Even the ombudsperson himself said the Income Tax Act is “completely nuts” and may need to be simplified before Ottawa’s plan to scale up automatic filing can actually work.
This complexity carries a real price tag: billions of dollars in compliance costs for individuals and businesses, on top of administrative costs to Ottawa. That’s unproductive tax planning, accountant fees, and hours spent on hold with CRA, all time and money that could go toward running a business or doing something more productive.
The tax structure itself also works against growth. Canada’s personal tax system ranks a dismal 27th out of 38 advanced countries on the Tax Foundation’s competitiveness index. High rates that kick in at relatively low income levels, combined with constant policy swings, discourage the kind of investment and risk-taking the country badly needs.
Alternative models show there is a better way.
Estonia, for instance, has topped that same competitiveness index for many years. A flat 22 percent personal rate. Zero corporate tax on reinvested profits. Returns pre-filled and confirmed online in minutes.
The bottom line is that CRA can reform its operations, but those tweaks can’t and won’t fix an overly complicated tax system. If the government wants to improve Canadians’ experience, simplification of the tax system is the answer.
Charles Lammam
Charles Lammam is an economic and policy professional with over two decades of combined experience as a think-tank scholar and thought leader,…
Read more
Canada’s tax system has become increasingly complex, leading to significant frustrations for taxpayers and inefficiencies within the Canada Revenue Agency (CRA). Complaints to the taxpayers’ ombudsperson surged by 27% in 2025–26, primarily due to processing delays. Despite a growing workforce, the CRA struggles with call response rates and accuracy. The complexity of the tax code, including various new rules and policies, hampers effective administration and increases compliance costs. Experts suggest that simplifying the tax system is essential for improving taxpayer experience and fostering economic growth.
