OTTAWA — Prime Minister Stephen Harper will keep the heat on Canadian tax evaders when he visits Switzerland later this week — but it seems many are already caving to the pressure.
In the two weeks since the Canada Revenue Agency said it would probe 1,800 accounts held by Canadians at the HSBC bank, 19 people have come forward and $1 million in unreported income has been revealed.
Revenue Minister Keith Ashfield said in an interview Tuesday that his department expects to double the number of voluntary disclosures on offshore funds this year.
In 2009, the Canada Revenue Agency recouped $138 million from 3,000 Canadians who came forward of their own accord.
“We’re probably looking at doubling the voluntary disclosures this year,” Ashfield said.
“We’re being very proactive on the file and things are happening.”
Canada’s tax agency has been mining data held by French authorities on accounts at Switzerland’s HSBC involving Canadian clients.
Last year, the Canadian government also found out indirectly that Canadians might be hiding money through Swiss bank UBS.
The news emerged as the United States threatened a lawsuit against the institution if it did not hand over details of American tax evaders.
Since Washington opened that can of worms, 217 Canadians have come forward about their UBS accounts.
The tax agency looked into 124 of those files and found $32 million in previously unreported income.
The U.S. and Germany have been at the forefront of a pressure campaign to force more transparency in the Swiss banking system.
Canada has a tax treaty with Switzerland that allows for an exchange of information, but some evidence of wrongdoing must first be presented.
Officials say Harper will discuss the issue with Swiss President Doris Leuthard when the two meet this Friday in Bern. Switzerland is host of the biennial summit of francophone nations this weekend in Montreux.
Jack Mintz, director of the University of Calgary’s School of Public Policy, says Swiss banks have a big presence in Canada’s financial community.
“Switzerland is one of the major countries that we borrow from, they play a significant role here in financing Canadian investments,” said Mintz.
Ashfield said he could not comment on where Canada’s talks with Switzerland stand.
“We’re working with a number of different countries to come to an agreement on financial records that they may be holding in those countries,” said Ashfield.
“We’re looking at initiatives in that fashion that we could move forward overall. It’s almost like a contractual agreement with those countries to release information back and forth.”
Ashfield’s predecessor Jean-Pierre Blackburn had pushed for changes with the Finance Department to make it easier for the tax agency to obtain intelligence gathered about Canadians with questionable banking activities overseas.
Those changes have still not been made.