Tax evasion target of new federal team
May 8th, 2013 - 4:06pm
The Conservative federal government is beefing up the tools used to go after tax cheats
Ottawa announced new measures Wednesday to crack down on international tax evasion, but NDP revenue critic Murray Rankin called the commitment “window dressing” in the face of deep job cuts at the revenue department.
Revenue Minister Gail Shea and Minister of State Maxime Bernier said the Conservative government is investing $30 million over five years to help the Canada Revenue Agency target hidden offshore tax havens and aggressive tax avoidance.
The amount includes $15 million earmarked in the spring budget and another $15 million reallocated from within the CRA to provide audit and other resources dedicated to international compliance and collection enforcement.
Part of the money will be used to set up a system to support reporting of international electronic fund transfers over $10,000, a requirement unveiled in the March budget.
“These don’t even qualify as baby steps,” said Rankin, who accused the government of shifting around existing money while refusing to go after major corporations abusing havens in jurisdictions such as the Cayman Islands and Barbados.
“I find it reprehensible that they have now been proven to be cutting those people doing auditing at the international level and at the same time they tell us that they are going after tax havens aggressively
Scott Brison, Liberal finance and revenue critic, called the announcement “nothing more than a financial shell game with money that’s being cut and then re-instated.”
Shea, however, said the investment will generate new revenue for the government and allow tax collectors to follow the money and root out cheats.
“The new tools and resources we’re making available will result in increased taxes being assessed and collected,” the minister said in Ottawa.
“Some Canadians go to great lengths to avoid paying taxes,” she added, calling it an unfair burden on the vast majority who play by the rules.
The Commons finance committee last week called on the government to do more to target tax evaders after an independent investigative report said 450 Canadians are among more than 130,000 people worldwide who hold accounts in countries known as tax havens.
The 2013 federal budget forecasts $2.4 billion in new revenue from efforts to target unreported tax havens accounts. While Ottawa has not indicated amounts lost to tax evasion, Rankin in an interview said an independent analysis calculates between up to $7.8 billion in foregone revenue each year.
Brison added that the government’s rhetoric doesn’t square with the facts.
“The Conservatives are slashing CRA by over $300 million each year,” he said in an email. “They’ve already cut the number of officials fighting tax evasion. Today’s announcement will offset less than 2 per cent of the Conservatives’ massive cuts to CRA.”