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But it also hindered the province’s ability to collect billions in back taxes, with some collectors seeing their workload double or even triple.

It took collectors an average of seven months to even attempt to contact a taxpayer by phone, and in two-thirds of cases there was at least one six-month gap where no action was taken, the auditor found. Field visits weren’t made, and liens and warrants for the seizure and sale of properties weren’t enforced.

“Taking prompt action is vital to collecting debts,” McCarter said in a release. “Research shows that the probability of collecting money that’s owed drops dramatically as time passes.”

The $1.4 billion is mainly made up of older accounts that have accumulated over years, the report said.

In one case where a liquor licensee owed $1.1 million in retail sales taxes, the branch didn’t attempt to revoke their liquor licence. The taxpayer eventually agreed to pay off the debt gradually, but defaulted after three payments totalling just five per cent of the taxes owed. Two years later, they voluntarily gave up their licence just as it was set to expire.

The Canadian Revenue Agency collects personal income tax on behalf of the province. It started to administer the Corporations Tax in 2009 and the HST in 2010. But the Ministry of Finance’s collections branch is still responsible for collecting the businesses and retail sales taxes prior to their transfer to the CRA.