TORONTO — A tendency in the Canada Revenue Agency to choose "what's easy" over "what's right" is to blame for $18 billion in unpaid taxes uncovered in the auditor general's latest report, some of its current and former employees say.

It's a system plagued by inefficiency, one that rewards managers with financial incentives regardless of whether debts are actually collected, a debt collector at the Toronto North tax office told The Canadian Press.

"Once you hit the budget, all the managers receive bonuses," said the employee, who spoke on the condition of anonymity.

"They follow what's passed down by their managers (for) more of a bonus, and from the director, who gets an even bigger bonus."

To meet the budget, collection agents must erase a pre-determined amount from their books.

That number can be resolved in two ways - either the debtor pays their taxes, or the collector writes off the account by declaring it "doubtful" or "uncollectable."

"They have big pushes. We have weeks where everyone says there's a deadline coming, we have to write off as much as possible because they set a budget from headquarters," said the employee.

"Everyone goes nuts and writes off all these accounts. It's just weird."

In last Tuesday's report, Auditor General Sheila Fraser identified $4.7 billion in doubtful or uncollectable accounts - $2.7 billion in 2004-05 alone.

Those accounts may well represent legitimate bankruptcies that cannot be collected on, but it still leaves a whopping $13.3 billion in unpaid taxes the agency expects to collect at some point.

"I think people will be wondering, why the heck are they working so hard to pay their taxes when Ottawa's not doing a good job of collecting amounts that are owed by scofflaws?" said John Williamson, federal director of the Canadian Taxpayers Federation.

CRA spokeswoman Jacqueline Couture said the federal agency is just like any other business, in that "everybody always has certain accounts that aren't collected at (a certain) point."

"It's not technically that we're having a hard time (collecting)," said Couture.

The auditor general didn't agree.

In her report, Fraser noted that the CRA can't seem to make good use of existing procedures for tracking and collecting back taxes. Fraser further said that the agency has known for "many years what it needs to do to improve its collection of tax debts, but its efforts have fallen short."

Many of Fraser's concerns mirrored criticisms the auditor general raised 12 years ago in a previous study on outstanding tax debt.

Requiring managers to hold a masters degree in business administration would go a long way to resolving those unresolved levies, said the employee.

"Three hundred collections officers in this building, one manager with an MBA, and he just left," said the employee.

"When you think about how much money, and how many people they're managing . . . I'm not saying an MBA is the be-all and end-all, but it's pretty specific for managing."

A large percentage of CRA debt collectors at the North Toronto office are just "sending letters and waiting, sending letters and waiting" because it's easier than contacting debtors on the telephone, said the employee, who blames the situation on the way the agency is run.

"They're clearly not interested in being efficient."

That culture of inefficiency is directly to blame for the $13 billion that has gone uncollected, one former CRA employee told The Canadian Press.

"People don't do what's right in the CRA, they do what is easy," said the former debt collector, who didn't want his name used.

"If doing right means getting your hands dirty, or walking that extra mile, forget it. Do what's easy, don't do what's right."