The Canadian Tax Journal has published Beyond Cost and Yield: The MVPF-TaxAdmin Framework for Evaluating Tax Administration Reforms Through Public Value, Equity, and Welfare, by Selvia Arshad, Gillian Petit, and Lindsay M. Tedds. It sets out a welfare-based way to judge how governments run the tax system, replacing the question of what a reform costs with the question of what social value it creates, and for whom.
Tax administration is usually assessed on operational terms: cost per return, processing time, audit yield, compliance rate. Those numbers say something about efficiency and almost nothing about whether a reform leaves people better off. The article’s starting point is that this is a real gap rather than a technicality. Every administrative choice, from how returns get filed to how audits are targeted to how people reach a call centre, distributes time, effort, and risk across the population, and it does so unevenly.
MVPF-TaxAdmin closes that gap by carrying the marginal value of public funds logic across from program evaluation into administrative design. The ratio puts the welfare change experienced by all potential taxfilers over the net fiscal cost to government, and it builds the numerator from three channels: fiscal efficiency, meaning administrative costs and compliance yield; distributional equity, meaning how time, literacy, and access burdens fall across income, geography, disability, and language; and legitimacy, meaning the effect on trust, transparency, and perceived fairness. Analysts can apply distributional weights, treated in the article as a sensitivity tool rather than a required assumption.
The proof of concept is Automatic Federal Benefits (AFB), the 2025 federal budget measure that authorizes the Canada Revenue Agency to file returns on behalf of low-income individuals with simple, no-liability tax situations beginning in the 2026 taxation year. The article works through four stylized scenarios, anchored on the Parliamentary Budget Officer’s costing and on evidence that between 10 and 12 percent of Canadians do not file, forgoing benefits they qualify for. The scenarios are bounding cases rather than forecasts, and the spread between them is the point.
Under a conservative design, with strong takeup and partial fiscal spillovers, the ratio lands near 2.4. Under a well-designed rollout, where fiscal externalities effectively offset the static cost, it rises much further. Under a poorly designed rollout, where digital access barriers and weak outreach mean prefilled returns never reach the people they were built for, the ratio goes negative at roughly −0.5, because equity-weighted compliance burdens and lost legitimacy outweigh the fiscal saving. That last case is the one conventional metrics cannot see: a reform that looks operationally efficient on a cost-per-return basis can destroy social value.
Canada is in the middle of a sustained modernization push at the CRA, running alongside a government-wide spending review and an auditor general’s report documenting long waits and accuracy problems at contact centres. Decisions about automation, enforcement design, and service delivery will be made repeatedly over the next several years under fiscal pressure. If those decisions are scored only on cost and yield, the design choices that determine whether low-income filers actually get through will not register in the evaluation at all.
MVPF-TaxAdmin is offered as a complement to existing fiscal metrics rather than a replacement, and the article is deliberately modest about precision. Legitimacy in particular is treated as a sensitivity parameter, with results reported both including and excluding it, so that conclusions do not rest on any single dollar value for trust. The value of the framework lies less in immediate adoption than in shaping how reforms are assessed as they are piloted, scaled, and revised.
The article also completes a pairing. A companion piece in the same Policy Forum, by Gillian Petit, Lindsay M. Tedds, and Jennifer Robson, treats tax administration as shared state infrastructure and proposes an intergovernmental accord to govern it. Read together, one supplies the evaluative lens and the other supplies the governance architecture.
Selvia’s research sits at the intersection of public finance, welfare economics, and tax policy. She is lead author on MVPF-TaxAdmin and a co-author on INCLUSIECON’s analysis of the federal basic personal amount. More at selviaarshad.com.
Three threads are worth flagging for policy readers. First, administrative design is a substantive source of social value rather than an implementation detail, which means it belongs in welfare analysis and not only in operational reporting. Second, distribution is treated as core to value: an hour of compliance burden lifted from a low-income senior carries more social weight than the same hour saved by a high-income professional, and the article makes that weighting explicit and debatable rather than leaving it buried in framework defaults. Third, several components can be implemented immediately with existing administrative data, including compliance-time valuation and segmentation of impacts, while legitimacy valuation needs incremental data collection but carries high decision value.
The article closes with a wider ambition: pairing welfare evaluation of programs with welfare evaluation of the administrative systems that deliver them, so that the two halves of public finance assessment can finally be read on the same page.