At the same time, only 44 Canadians were convicted of offshore tax evasion between April 2006 — shortly after the Harper government took office — and March 2012, according to new documents tabled in Parliament, raising new questions about the Conservative government’s record on the file.
Canadians for Tax Fairness, a domestic advocacy group, says new Statistics Canada data show Canadian money socked away in the major tax havens has hit a new record of $170 billion — nearly 10 per cent of Canada’s $1.8 trillion gross domestic product.
The amount of Canadian money parked in the top three tax havens — Barbados ($59 billion), Cayman Islands ($30 billion) and Luxembourg (about $20 billion) — has more than doubled since 2005 to $109 billion, the group calculates.
Holding an offshore account or company is not illegal and doesn’t necessarily indicate wrongdoing as long as the related income is reported. A number of businesses have legitimate reasons for holding offshore assets.
Yet, the watchdog figures that international tax havens are costing the federal and provincial governments at least $7.8 billion annually in lost revenue.
“It’s still a big problem because it’s very hard for the Canadian government to police that because of the secrecy,” said Dennis Howlett, executive director of Canadians for Tax Fairness.
“More and more money is going to offshore.”
The group’s announcement Friday came as documents tabled in the House of Commons show that only 44 Canadian taxpayers were convicted of tax evasion related to money and other offshore assets between April 1, 2006 and March 31, 2012.
The convictions involved $7.7 million in federal taxes evaded, as well as $6.8 million in fines and 337 months in jail. The fines ranged from approximately $12,000 to $1.1 million, according to the documents, with jail sentences ranging from zero to 48 months.
Of the 44 convictions, seven came via trial and 37 from guilty pleas. The documents also show that, during those six years, 11 cases of suspected offshore tax evasion were referred for prosecution but did not go to trial, while five cases saw acquittals or charges withdrawn.
With pressure mounting on Ottawa to crack down on tax cheats, the federal government says it will be provided information on Canadians identified in a massive tax evasion investigation launched by the United Kingdom, United States and Australia.
Revenue Minister Gail Shea says she has secured a commitment from the United Kingdom that any relevant Canadian information stemming from the tax evasion investigation will be shared with Canada.
Shea said her officials have also made formal requests to U.S. and Australian tax authorities to obtain the data.
“We work with our international partners. We have secured a commitment for our international partners to share this list with Canada so that’s a very important step,” Shea said Friday.
“The message is for those who want to participate in international tax evasion that we will find you.”
The minister couldn’t say whether anyone in the department was offered access to the same data last year.
The UK, U.S. and Australia announced an investigation Thursday into offshore trusts and companies — in tax havens such as Singapore, the British Virgin Islands, Cayman Islands and Cook Islands — that were used to “conceal assets by wealthy individuals and companies.”
Governments in the three countries obtained more than two million documents on thousands of people worldwide that identify the owners of the offshore entities, as well as the accountants, lawyers and other advisers who helped establish them.
The investigation by the three countries covers information that is believed to include much of the same data obtained by the International Consortium of Investigative Journalists (ICIJ), including the CBC.
The leak of information obtained by the investigative journalism group identified approximately 130,000 people worldwide, including what’s believed to be about 450 Canadians, with accounts in offshore tax havens.
Shea announced this week the Canada Revenue Agency will create a new “SWAT team” of six to 10 CRA officials to track down tax cheats, part of a $30-million investment over the next five years to crack down on Canadians with accounts hidden in offshore tax havens.
Howlett with Canadians for Tax Fairness said the small team of CRA officials is “hardly enough” to deal with potentially hundreds of Canadian files of offshore tax evasion included in the international investigation.
“Even the recent (government) measures still aren’t bringing them up to speed. They’re still trying to play catch-up to the UK, Australia and the United States,” Howlett said.
Original Article
Source: ottawacitizen.com
Author: Jason Fekete
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