More than three decades after its introduction, the Goods and Services Tax (GST) remains a significant source of stress for small businesses, according to new research from the Canada Revenue Agency.
Blacklock's Reporter says business owners across the country report that navigating GST paperwork is so complex that most are forced to hire accountants to handle the process.
A survey of 712 business operators and accountants, conducted under a $114,961 contract with Ottawa-based Earnscliffe Strategy Group, found that 60% of respondents described tax filing as stressful, while 61% called it complicated. Only 7% said the process was not complicated at all.
While many business representatives feel confident in meeting their overall tax obligations, the GST filing process is still widely seen as burdensome. The study, titled GST Filing Compliance Study, was conducted to help the Agency understand non-compliance and improve tax collection.
The findings indicate that 73% of businesses rely on external tax professionals to manage their filings, with smaller businesses — particularly those with fewer than five employees — being the most likely to outsource the work. Only 26% handle taxes in-house.
Businesses also vary in how frequently they file GST remittances. About 45% report filing quarterly, while 31% file annually. Another 13% — mostly large corporations earning at least $6 million per year — file monthly.
When asked to describe their experience with tax filing, small business owners overwhelmingly used negative terms such as “complicated,” “stressful,” “painful,” “frustrating,” and “overwhelming.” More neutral or positive responses included “compliance,” “mandatory,” and “important.”
The GST was first introduced in 1991 during an economic downturn and was widely unpopular.
A 2000 report from the Department of Finance acknowledged that the tax faced strong opposition, largely due to its visibility and the economic challenges of the time. The 1990s, marked by high deficits and sluggish growth, created an especially difficult environment for tax reform.
More than 30 years later, many small business owners continue to find the GST just as challenging as when it was first implemented.