Plan to cut government tax lawyers could hurt tax evasion fight: critics
August 22nd, 2013 - 11:40pm
| Aug 22, 2013 5:00 am |
Only weeks after it vowed to crack down on offshore tax evasion, Prime Minister Stephen Harper’s government is planning to slash the number of lawyers who handle Canada Revenue Agency cases, iPolitics has learned.
The Justice Department has put out a call for 30 lawyers in its Tax Law Services Portfolio to voluntarily take a departure package and leave the public service. The departures are slated to take place in the 2014-15 fiscal year, which begins April 1.
Lisa Blais, president of the Association of Justice Counsel, which represents federal government lawyers, said the move means a 10 per cent cut in the number of federal government tax lawyers.
Blais said she fears the cuts will have an impact on the government’s ability to fight tax evasion.
“How do you commit yourself to fighting aggressive tax avoidance and at the same cut down the number of lawyers who would prosecute. We just find the logic incongruous and we just think that Canadians and Canadian taxpayers will suffer in the end.”
Blais warned the move could also cost the government some of its best and brightest tax lawyers, those who can most easily find a job in a private law firm.
However, Blais is glad the justice department is calling for volunteers rather than resorting to the “brutal” SERLO layoff process it used for other cuts, in which lawyers had to compete against each other for the positions that remained.
Justice department spokesman Andrew Gowing said the department is doing its best to minimize the impact of the cuts but it has to reduce its budget by $67.5 million over three years.
“The Tax Law Services Portfolio will be reduced through several measures including measures to streamline the delivery of advisory and coordination services and the implementation of cost-effective practices and processes,” Gowing wrote. “According to information currently available, the portfolio may need to reduce its national LA (law) complement depending on attrition and available complement.”
Gowing said the department has not yet made a final decision on the number of positions that will have to be cut.
He said the department is trying to minimize the impact on its tax lawyers and avoid layoffs by taking a national approach, calling for volunteers and taking advantage of attrition.
The government’s internal call for volunteers comes despite Canada’s promise to the G8 to step up efforts to shed light on those who hide money in offshore tax havens and a much publicized promise to crack down on tax evasion.
“Our government is committed to combating tax evasion and getting tough on tax cheats,” former revenue minister Gail Shea said in June.
However, NDP Revenue Critic Murray Rankin, who sits on the House of Commons finance committee that studied tax havens, said cutting tax lawyers calls into question the government’s determination to get tough on tax evasion.
“How can we take them seriously about their agenda, to really go after tax dodgers and the serious problems we talked about in our tax haven study, when the lawyers aren’t available to do their part of the job.”
Instead of cutting justice department tax lawyer positions, the government should take a page from British Prime Minister David Cameron who recently vowed to go after “cowboy tax advisors,” Rankin said.
“We should be doing that too. But if you don’t have the lawyers and the accountants and the fire power to do the job, the big fish are going to get away every time.”
Liberal Senator Percy Downe, who has been following the question of offshore tax evasion closely, said cutting 10 per cent of the justice department’s tax lawyers is yet another sign the Conservative government isn’t serious about providing the necessary resources to fight tax evasion.
“They simply refuse to properly fund and finance, to provide the necessary resources to win this fight and the failure to win the fight is costing the rest of Canadians who play by the rules and pay their fair share of taxes. We have to make up the shortfall that the government is failing to collect.”
However, Revenue Minister Kerry-Lynne Findlay said Thursday that the government has made unprecedented investments in fighting tax evasion and introduced measures in the last budget that will give the CRA new resources to crack down on tax evasion.
“Our Government will ensure that CRA always has the tools and resources required to crack down on tax cheats, and ensure everyone pays their fair share,” she said in a statement. “These reductions will not impact CRA’s access to legal counsel or representation.”