Recommendations on tax havens don’t go far enough, MPs say

OTTAWA — Banks and other financial institutions should have the power to find out who’s actually behind corporations that stash money in offshore tax havens, says a House of Commons committee.

OTTAWA — Banks and other financial institutions should have the power to find out who’s actually behind corporations that stash money in offshore tax havens, says a House of Commons committee.

In a report tabled in Parliament on Wednesday, the Commons finance committee also urges the Conservative government to close tax loopholes and develop laws that crack down on those who avoid paying their share.

The report recommends maintaining “taxpayer morale” by publicizing the government’s “ongoing efforts” to ensure fairness in Canada’s tax system.

The main opposition parties, saying the recommendations don’t go far enough, issued supplementary reports.

The NDP and Liberals want the government to calculate and publish the tax gap — the amount Canada is losing to tax evasion and shady havens.

Independent estimates indicate Canada could be losing up to $7.8 billion annually in tax revenue, the New Democrats say in their report, but the federal government has not made an effort to quantify the gap.

“Without such an estimate, it is impossible to determine the degree of tax base erosion or measure the adequacy of corrective measures,” the NDP says.

Committee chairman James Rajotte said Wednesday the big challenge is determining how to gauge the gap. “How do you measure something that is in fact being concealed?”

He suggested the emphasis should be on getting more information about those who aren’t paying their fair share of taxes before estimating the size of the problem.

The New Democrats say the Canada Revenue Agency should require Canadian corporations to declare all of the taxes they pay abroad, country by country, with the goal of greater transparency.

In addition, the NDP recommends the auditor general regularly evaluate the revenue agency’s efforts to prosecute and settle cases of tax evasion.

The committee heard from dozens of witnesses representing federal agencies, the provinces, banks, police and other interested individuals.

A key recommendation of the committee majority would see the government require banks, trust companies, real estate agents, casinos and others who report under money laundering and terrorist financing laws to obtain information about the actual ownership of enterprises.

Sometimes this information is shielded behind another name that has little to do with the company, making its activities difficult to trace.

The majority report also recommends the government continue to pursue tax information exchange agreements with other countries as a means of fighting evasion.

However, the NDP said such agreements are often ineffective because they lack a means of automatically exchanging tax information with Canada.

“I think people are looking for action,” said NDP revenue critic Murray Rankin. “The report’s main recommendations aren’t about action, they’re about studies and this and that. I don’t think this goes nearly far enough for Canadians.”

The NDP says recent cuts to the federal revenue agency will make it even harder to track down tax cheats.

However, Rajotte said divisions that deal with tax evasion will not be receiving less resources as a result of any federal cuts.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Red Deer Public Schools says that in the absence of additional funds from the provincial government, there was no consideration of using alternate classroom sites in the district. (AP Photo/Gregory Bull)
Red Deer Public Schools launches online engagement process

Red Deer Public schools is seeking community input to help ensure a… Continue reading

Students walk into Hunting Hills High School, which is one of the Red Deer Public Schools with solar panels on its roof. (Photo by SEAN MCINTOSH/Advocate staff)
Red Deer high school was placed in lockdown following potential threat

Hunting Hills High School was placed in a lockdown Friday after Red… Continue reading

Red Deer Mayor Tara Veer says some details of the provincial government’s 2021-22 budget need to be ‘sorted out’ when it comes to the hospital expansion funding. (File photo by Advocate staff)
More detail needed regarding hospital funding, says Red Deer mayor

Red Deer Mayor Tara Veer says some information is unclear regarding the… Continue reading

Alberta Health reported two new COVID-19 deaths in Red Deer Friday. (Image courtesy CDC)
Two more deaths linked to Olymel outbreak in Red Deer

Province reported 356 additional COVID-19 cases Friday

Nicole Buchanan, chair of Red Deer Public Schools board, says it’s too soon to say how the provincial government’s 2021-22 will impact the district. (Contributed file photo)
Red Deer school boards react to provincial budget

It’s still too soon to say how the latest provincial budget will… Continue reading

An arrest by Red Deer RCMP is facing online scrutiny. No charges have been laid and the incident is still under investigation. (Screenshot of YouTube video)
Red Deer RCMP investigating violent arrest caught on video

Police say officer ‘acted within the scope of his duties’

Prime Minister Justin Trudeau rises during question period in the House of Commons on Parliament Hill in Ottawa on Wednesday, Feb. 24, 2021. THE CANADIAN PRESS/Sean Kilpatrick
New vaccine brings optimism amid rising threat of variants, high case counts

New vaccine brings optimism amid rising threat of variants, high case counts

A nurse prepares to give the first COVID-19 vaccine to be distributed in Edmonton on Tuesday, Dec. 15, 2020. THE CANADIAN PRESS/Jason Franson
Doctors urge Alberta to hold off on easing COVID-19 restrictions next week

Doctors urge Alberta to hold off on easing COVID-19 restrictions next week

Minister of Health Tyler Shandro speaks during a press conference in Calgary on Oct. 7, 2020. The Alberta government and its 11,000 physicians have taken a first step toward resolving an ugly, fractious year-long dispute over fees and working conditions. THE CANADIAN PRESS/Jeff McIntosh
Alberta and its physicians move to end ugly feud over fees with new tentative deal

Alberta and its physicians move to end ugly feud over fees with new tentative deal

A worker carrying a disinfectant sprayer walks past a WestJet Airlines Boeing 737-800 aircraft, after cleaning another plane at Vancouver International Airport, in Richmond, B.C., on Thursday, January 21, 2021. THE CANADIAN PRESS/Darryl Dyck
WestJet to lay off undisclosed number of pilots amid labour negotiations

WestJet to lay off undisclosed number of pilots amid labour negotiations

The Site C Dam location is seen along the Peace River in Fort St. John, B.C., Tuesday, April 18, 2017. THE CANADIAN PRESS/Jonathan Hayward
British Columbia’s Site C dam to cost $16 billion, delayed until 2025

British Columbia’s Site C dam to cost $16 billion, delayed until 2025

Mark Machin, President and CEO of Canada Pension Plan Investment Board, speaks at a seminar on building a sustainable social security system in Beijing, China on Monday, Feb.20, 2017. Machin has resigned after admitting he was vaccinated for COVID-19 abroad. THE CANADIAN PRESS/HO-Canada Pension Plan Investment Board MANDATORY CREDIT
CPP Investments CEO Mark Machin resigns after travelling to UAE for COVID-19 vaccine

CPP Investments CEO Mark Machin resigns after travelling to UAE for COVID-19 vaccine

Selina Robinson listens to Premier John Horgan in Coquitlam, B.C., Friday, Nov. 17, 2017. Robinson, B.C's finance minister, says she's encouraged by predictions that British Columbia's economy will rebound this year and next. THE CANADIAN PRESS/Darryl Dyck
Economists predict slight rebound and moderate growth for B.C. economy in 2021

Economists predict slight rebound and moderate growth for B.C. economy in 2021

A street sign along Bay Street in Toronto's financial district is shown on Tuesday, January 12, 2021. THE CANADIAN PRESS/Nathan Denette
S&P/TSX composite falls as commodities, financials struggle

S&P/TSX composite falls as commodities, financials struggle

Most Read