Uncollected corporate taxes surge to $1.1 billion

[tay]

The mounting tab now totals more than $1.1 billion, an amount roughly equal to one-fifth the total amount actually collected from corporations over the last 12 months and two times what the new NDP government hopes to raise annually by hiking the rate for big businesses from 10 to 12 per cent.


The Finance Department’s recent annual report also shows that fully 38 per cent of what’s outstanding, or $431 million, will likely have to be written off.


The numbers suggest the problem is getting worse.


“The risk of not collecting the taxes owed by corporations is that the government won’t have the money it needs to pay for programs,” assistant auditor general Brad Ireland said in an interview.


“And the longer these amounts are left outstanding the less likely they are to ever be paid.”


In response to the watchdog’s report, the department said Wednesday that new collections officers have been hired and caseloads are being adjusted inside the corporate taxation unit.


The NDP campaigned during the recent election on boosting efforts to collect delinquent and unpaid corporate taxes, and Finance Minister Joe Ceci said Wednesday he has asked his department to make changes quickly.


“The auditor general has given us until 2017 to implement these recommendations, but I believe we need to move faster on this,” Ceci said in a prepared statement.


“The vast majority of Albertans and Alberta companies do the right thing and pay their taxes, and expect others to do the same.”
One of only two provinces that do not contract with Canada Revenue Agency to collect corporate taxes, Alberta spent $34 million last year to collect $5.6 billion in corporate taxes.


While running its own administration meant Alberta got to keep about $230 million in interest and penalties it collected last year, it also means the province has to assume the risk if taxes assessed go unpaid and ultimately have to be written off.


Nearly half of the $1.1 billion amount outstanding or some $547 million relates to nearly 900 corporate returns that are being disputed by businesses.




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Uncollected corporate taxes surge to $1.1 billion, despite watchdog’s warning | Calgary Herald

 

[taxslave]

SO most of this is not really uncollected taxes. Just some numbers thrown out by tax collectors that they think business should give them.

 

[grainfedpraiboy]

I'm a business owner in Alberta and I know other business owners and I will tell you right now the underlying spin that companies are somehow withholding taxes to pad their bank accounts on the backs of social programs is complete balderdash.

When a corporation can't pay the taxes they owe it is likely because that business has gone under or is struggling. Either reason doesn't morally exempt them from the requirement of paying taxes and in the case of a struggling business that is ultimately sunk because of tax arrears I say let them sink because I had to pay my taxes and that other business might be a competitor of mine. Economic natural selection is the route to the healthiest economy.

Most businesses that are hurting pay their employees and suppliers long before their taxes as this is something you can defer long term as it takes a couple of years for the government to get you but I can assure you this is no temporary loan on the back of society as the penalties and interest far exceed anything in the private sector and if you're still in business the government just seizes your bank accounts. Some businesses turn things around and eventually pay their tax bills while others close up for good leaving an unpaid bill.

Bottom line is this........if every business that owed me money paid me I would have considerably more than I do now. That there will always be noncollectable arrears is a reality that the new NDP finance minister and their political boss imported from outside the province will have to accept.