Estimating and analyzing the tax gap related to the Goods and Services Tax/Harmonized Sales Tax: Rv4-83/2016E-PDF

“The analysis of GST/HST gap estimates for the period from 2000 to 2014 shows that, on average, about 5.6 per cent of potential tax revenues are forgone due to non-compliance. This paper does not attempt to estimate how much revenue is forgone due to non-payment. Many factors need to be considered when analyzing tax gaps including that the estimates are modeled and therefore impacted by the underlying assumptions and survey data. While this estimate is useful in providing a rough benchmark of the extent of GST/HST non-compliance in Canada, it cannot be used to pinpoint which groups or sectors are the most likely to be non-compliant. Tax gaps are best viewed as a trend over time. This is supported by the fact that fluctuations in the tax gap can be explained by the timing of when ITCs are claimed and changes to the GST/HST rates or provincial partners. This analysis suggests that non-compliance with the GST/HST has been fairly constant over time and is in the mid-range compared to international estimates"--Conclusion, p. 10.

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Department/Agency Canada Revenue Agency.
Title Estimating and analyzing the tax gap related to the Goods and Services Tax/Harmonized Sales Tax
Publication Type Monograph
Language [English]
Other Language Editions [French]
Format Electronic
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Note Issued also in French under title: Estimation et analyse de l’écart fiscal lié à la taxe sur les produits et services/taxe de vente harmonisée.
Date [2016]
Number of Pages 11 p. :
Catalogue Number
  • Rv4-83/2016E-PDF
Subject Terms Sales taxes, Compliance, Statistics