Offshore tax havens will be one of the major subjects of the upcoming G8 conference in Northern Ireland, where British Prime Minister David Cameron is spearheading an effort for an international tax evasion agreement.
The proposed deal would allow governments to share “beneficial ownership information” about suspected tax cheats -- information that can reveal who the real owners are of offshore accounts and dummy corporations.
“Harper is worried about exposing private Canadian tax affairs and fears complications arising from Canada's federal structure,” The Guardian reported on Thursday.
France, Germany and Italy are reportedly backing the plan, but Canada is not the only G8 member to have doubts about it. Russia is reportedly objecting to the measure, and U.S. President Barack Obama’s position is unclear. (Obama is also under political pressure to back a deal.)
The U.K., France, Germany, Spain and Italy have already signed on to a pilot project to share information related to potential tax evasion.
The Harper government is also reportedly resisting efforts for a deal that would see countries set up tax information exchanges to better track tax cheats across borders, Postmedia News reports.
The proposal would see governments collect data on income from foreign sources, and then report that back to the foreign country in question, so that tax records could be compared.
Harper’s communications director, Andrew MacDougall, said the government is “broadly supportive” of Cameron’s agenda.
“We do support more action,” he said, as quoted at Postmedia.
The opposition NDP criticized the government this week for “becoming an international obstacle to tackling tax havens.”
NDP Foreign Affairs critic Paul Dewar accused the Harper government of “choos[ing] to protect those who use international tax havens to evade paying their taxes.”
The move “fits a pattern of behavior from a Conservative government that has repeatedly undermined efforts to reach a multilateral consensus on important issues facing the world,” he added, as quoted at iPolitics.
“Instead of focusing on exposing tax havens and catching tax cheats, the Conservatives have slashed the Canada Revenue Agency's investigative resources and staff,” NDP National Revenue critic Murray Rankin said in a statement.
The Harper government eliminated hundreds of jobs and slashed $250 million from the budget of the Canada Revenue Agency (CRA) over the next few years as part of its most recent budget.
A series of investigative reports from the CBC this week alleged that the CRA missed out on an opportunity to pursue Canadians listed in the world’s biggest leak of tax cheat data, and has been artificially inflating its numbers on prosecution of people using offshore tax havens.
A leak of tax data last April reportedly included the names of 450 Canadians using offshore tax havens, but months before the leak the CRA was given the opportunity to obtain the names, sources told the CBC. The CRA refused because of a policy not to pay for information.
According to activist group Canadians for Tax Fairness, offshore tax havens are costing Canada some $7.8 billion in revenue annually, money that has to be made up for with higher tax rates for those who do pay.
Canadians for Tax Fairness has partnered with Oxfam Canada and Avaaz.org to pressure Harper to sign on to the tax proposals.
“These two measures are key to lifting the veil of secrecy that allows wealthy individuals and corporate tax evaders and criminal organizations to hide their wealth offshore,” the group said in a statement this week.
A study last year estimated that there is between $21 trillion and $32 trillion stashed away in offshore tax havens.
Original Article
Source: huffingtonpost.ca
Author: Daniel Tencer
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