Union considers legal action over CRA tax ruling

Canada_Revenue_Agency

Canada's biggest civil service union says it is considering taking legal action against the Canada Revenue Agency.

This follows a CRA ruling that damages paid to federal employees in connection with the troubled Phoenix pay system are taxable.

The Public Service Alliance of Canada says it has received notice that the agency won't review the taxability of the payments.

They were part of a contract settlement dealing with the financial, mental and emotional harm caused to government employees who were overpaid, underpaid or not paid at all through the Phoenix system.

Payments of up to 25-hundred-dollars each were issued in March to civil servants affected by the damages agreement, minus applicable income taxes and other deductions.

In a letter sent to the union, dated April 27th, the tax agency turned down the union's request to review the taxation issue.

The C-R-A said in the letter, the government agency responsible for paying civil servants and the union did not provide the agreed-upon information needed to conduct a review.

The review was contingent on both the union and Treasury Board Secretariat providing a joint statement, but CRA says none was provided.