6.2 Annual estimation methods and data sources
6.14 Taxes less subsidies, either on products or on factors of production, are estimated from the same sources, using the same methodologies.
6.15 For this discussion of sources and methods, the three stages of the production-revision cycle will be considered starting from the benchmark years (first two years of the four year revision cycle, t-4 and t-3) to the non- benchmark years (last two years, t-2 and t-1) and progressing to the current quarter estimates. This order works better because the benchmark year estimates which are based on information from public accounts, audited financial statements and censuses of universe entities, provide a solid ground for understanding the government institutional sector and its activities.
6.16 The benchmark years estimates also benefit from the commodity and industry balancing of the Input-Output Tables (IOT) and are the product of an integrated effort by statisticians of the Industry Accounts Division, the Income and Expenditure Accounts Division and the Public Institutions Division (see paragraph 8.13). These estimates are used in establishing the level of the non-benchmark years.
6.17 Non-benchmark year estimates are based on similar source information – financial reports and statements, budget estimates and survey responses–but final versions are often not yet available and the information is still subject to revision.
6.18 Current quarter estimates are based on sub-annual administrative or financial reports, budget estimates and related indicators.
6.19 The federal government sub-sector is divided into two parts for purposes of estimation, as the underlying data sources are different. These two parts are called budgetary1 and extra-budgetary.
6.20 Information for the budgetary part of the sub-sector comes from the Government of Canada Banking and Accounting System of Public Works and Government Services Canada (PWGSC), specifically the Public Accounts of Canada2 and from monthly statements provided by Public Works and Government Services Canada and by Canada Revenue Agency (CRA). Budgetary taxes include customs duties, excise duties (on alcohol and tobacco), excise taxes on motive fuel and other products and the Air Travellers Security Charge. For the last year of the four-year revision cycle, no public accounts are available and the estimates are based on the monthly Canada Revenue Agency and Public Works and Government Services Canada information.
6.21 Data sources for the extra-budgetary part include annual and sub-annual financial reports and statements of the extra-budgetary entities or other information obtained directly from them. If the information is not forthcoming for the most recent year(s), estimates are calculated using data from earlier periods. Extra-budgetary taxes include the Canadian Dairy Commission Levy, premiums charged by the Canada Deposit Insurance Corporation and licence fees paid into the Canadian Television Fund.
6.22 The Goods and Services Tax (GST), while a part of budgetary revenue for the Government of Canada, is not estimated from information contained in the Public Accounts of Canada. For the benchmark years (and the first non-benchmark year), the annual estimate for GST revenue comes from the GST/HST Revenue Pool established by the Government of Canada and those provinces that have harmonized their sales taxes with the GST (New Brunswick, Nova Scotia and Newfoundland). This estimate is then reconciled with the estimate of GST embedded in the components of the final demand matrix of the Input-Output Tables (IOT) to produce annual control totals.
6.23 For the most recent year, the Goods and Services Tax (GST) is estimated using an aggregate indicator and projector calculated from the estimates of GST embedded in the final domestic demand components of GDP. Through the Input-Output Tables reconciliation and integration process, control estimates are established for the GST embedded in each GDP final demand component. As these final demand components are estimated for non-benchmark years (and, indeed, for current year quarters) they yield an estimate of related GST. An aggregation of these estimates of embedded GST yields the estimator used to produce the GST for the second non-benchmark year, and subsequent periods. Available quarterly, this estimator is also used to distribute the annual GST data for use in the quarterly IEA.
6.24 Agricultural subsidies3 are estimated as part of accrued net income of farm operators from farm production (Chapter 5). The main sources are Agriculture Division surveys, Agriculture and Agri-Food Canada, the Canadian Grain Commission and various marketing and regulatory agencies in Canada and the provinces.
6.25 Non-agricultural subsidies paid by the federal administration are derived from the Public Accounts of Canada and financial statements of government business enterprises receiving subsidies for the benchmark years. Non- benchmark years are estimated from monthly Public Works and Government Services Canada information and information obtained from federal government business enterprises. All non-agricultural subsidies are part of the budgetary accounts.
Provincial and territorial governments
6.26 For benchmark years, source documents used to estimate provincial and territorial taxes and non-agricultural subsidies include the public accounts of each province and territory for budgetary components, and audited financial statements and annual reports of extra-budgetary entities. Non-benchmark year estimates are prepared from information published, annually and quarterly, by provincial governments in budgets, public accounts and other financial statements. In the case of component entities for which financial statements are not available for the most recent year(s), information from the most currently available year is substituted.
6.27 An exception is the provincial share of the Harmonized Sales Tax (HST) which is derived from the same GST/ HST Revenue Pool used to establish the federal GST control. Three provinces, Newfoundland, New Brunswick and Nova Scotia, harmonize their provincial sales taxes with the federal sales taxes. The reported HST figures in the provincial government public accounts are not used because they may contain adjustments for prior periods.
6.29 Taxes and subsidies received or paid by municipal governments are derived from annual reports of provincial and territorial government departments of municipal affairs, which summarize information for all municipalities in their jurisdiction, and from financial statements of municipalities and other local government entities.
6.30 Estimates for school boards are based on provincial and territorial department of education information representing a census of local schools. This information is gathered from surveys conducted by Culture, Tourism and the Centre for Education Statistics.
6.31 For non-benchmark years, local administration taxes and subsidies are estimated using: a sample survey collecting municipal budget estimates information, conducted by Public Institutions Division; and, a sample survey collecting financial information for local schools conducted by Culture, Tourism and the Centre for Education Statistics.
1. Budgetary entities is the terminology used in Canadian public finance to describe the ministries, departments and agencies of the government. Similarly, extra-budgetary entities is used to describe what the public sector universe refers to as autonomous organizations, boards, commissions and funds, that is, entities that the Canadian System of National Accounts includes in the federal sub-sector but which are not included in the Government of Canada's budgetary universe, for example, the Canadian Broadcasting Corporation (CBC).
2. The federal, provincial, territorial and Canada and Quebec pension plans public accounts benchmark data are all on a fiscal-year basis. Since estimates for these entities in the IEA were all originally made for a specific quarter, based on monthly or quarterly information, it is a relatively simple matter to convert the benchmark data from a fiscal-year to a calendar-year basis using the appropriate component quarters.
3. Government program payments to farmer and government payments made under farm support programs are used as alternate terminology for agricultural subsidies in Chapter 5.
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