Thursday, April 2, 2015

Fairness for All Canadian Taxpayers Act (FACT Act)
Senator's FACT Act would shine light on scale & cost of overseas tax evasion

Charlottetown Senator Percy Downe will introduce the Fairness for All Canadian Taxpayers Act (FACT Act) today in the Senate as part of his ongoing effort to determine the impact of the money lost to overseas tax evasion on the Canadian economy. Essentially, the bill would require the Government to report annually on what is known as the "tax gap", the difference between what the government is owed in taxes and it what it actually collecting. Despite repeated efforts by the Parliamentary Officer (PBO) to produce an estimate of the gap, the Canada Revenue Agency (CRA) has continually delayed and stonewalled any request by the PBO for cooperation, even though such cooperation is required by the PBO's mandate.

"In these tight fiscal times where every dollar counts and programs are being cut or reduced, the Government of Canada does not know how much revenue it should be collecting. Are we losing $3 billion to overseas tax evasion or $30 billion? I don’t know, you don’t know and more importantly, the Government doesn’t know," said Downe.

In providing such an estimate, Canada would join such jurisdictions as the United States, the United Kingdom, France, Israel and even the state of California, who regard such an exercise as, in the words of the UK's Her Majesty's Revenue and Customs, a "foundation" of taxation strategy.

“The Act would also require the government to compile a list of all convictions for overseas tax evasion. That way, Canadians will be able to see how many - or how few - of their fellow citizens are being called out for not paying their fair share by hiding their money overseas in tax havens,” stated Downe.

A glance at the CRA website will show that recently there have been all kinds of convictions for domestic tax evasion: a real estate agent in British Columbia, a house painter in New Brunswick, a doctor in Saskatchewan. But no convictions for overseas tax evasion are listed. Why is that? Is it because it isn’t happening? Or worse, because those responsible are getting away with it?

"As in all things, justice in our taxation system must be seen to be done. A double standard that allows some Canadians to hide their money overseas to avoid paying taxes while the rest of us have to make up the shortfall cannot continue," concluded Downe.

For further information:
Senator Percy Downe: 613-943-8107
Or toll free at 1-800-267-7362   
www.sen.parl.gc.ca/pdowne