The Department did not always test commercial equipment before buying it to make sure it could adequately perform the military tasks for which it was being acquired. In some cases, costly modifications and additions will have to be made to ensure that the equipment can be used to carry out military roles. This will make it easier for the taxpayers to comply with the law, as well as protecting the tax base. The three departments have identified over 400 ambiguities and anomalies in the Income Tax Act that need to be addressed. These deficiencies can confuse taxpayers, lead to non-compliance and cause lengthy tax disputes between the government and taxpayers.
Ambiguities can lead to unequal treatment of taxpayers.
Although Revenue Canada is the department that deals directly with taxpayers, the Department of Finance introduces legislation and the Department of Justice gives legal advice in interpreting the law and represents the Crown in tax disputes. The Report states that these three departments should all be involved in deciding which legislative deficiencies deserve attention immediately, and correct them accordingly. The Auditor General urges Revenue Canada and Justice to strengthen their partnership in planning for the resources needed in the area of tax litigation. The Auditor General added that he is pleased that departments have taken many important measures to improve their relationships as a result of a 1993 audit by his Office and subsequent recommendations by the Public Accounts Committee of the House of Commons. He added that this momentum is essential to the smooth functioning of the proposed Canada Customs and Revenue Agency.