The Canada Revenue Agency wants more people to file their personal income tax returns online.
The agency has discontinued its free Telefile service that allowed people with basic returns to file by entering their tax information using the telephone.
The change is expected to affect about 300,000 people across the country and require fewer tax information packages to be mailed out.
Canada Revenue has also stopped mailing people who use an access code with the online service Netfile. It wants them to use their social insurance numbers and birth dates instead when filing their tax returns.
"We are modernizing our electronic processes to make them easier and more accessible for Canadians to use while maintaining the highest level of security," reads the agency's website.
"Our goal is to improve service, increase electronic filing and reduce compliance burden to Canadians."
Agency officials declined an interview request Thursday on the policy changes.
Noel Carisse, an agency spokesman, wrote in an email that the push for more online filing would save the federal government money, but Carisse did not indicate how much.
"In 2011, printed packages for approximately 1.3 million individuals went unused," Carisse wrote.
"Further, it costs about four times more to process a paper return than an electronic return."
The email did not address whether cutting costs was a factor in eliminating the Telefile phone filing service.
The Canada Revenue website says fewer people were using Telefile and almost two-thirds of Canadians now file their returns using services such as Netfile, either on their own or with the help of a tax preparer.
It says using Netfile allows the agency to process tax returns and send out refunds more quickly -- in as little as eight business days.
Scrapping the Netfile access code will also speed up service without affecting security, the agency says.
"The Canadian Revenue Agency uses the most secure forms of encryption available today. These are the same levels that your financial institution uses to protect your banking information."