14/03/17

Canada: P.E.I. MP Wayne Easter pleased with response to tax evasion report

Easter is the chair of the committee, which made 14 recommendations to government in light of revelations of an offshore corporate structure developed by KPMG, reports The Guardian.

“The government, in its response to the report, accepted all of the committee’s recommendations,” said Easter. “These actions will work to strengthen and enhance (Canada Revenue Agency’s) efforts to combat tax avoidance and evasion.”

On April 11, 2016, the Government of Canada announced it would invest more than $444 million to enhance the Canada Revenue Agency’s (CRA) ability to detect, audit and prosecute tax evasion both at home and abroad.

From May 3-19, the finance committee held hearings to study the steps being taken by the CRA to combat tax evasion and tax avoidance as well as the current status of the KPMG/Isle of Man file. The committee heard from witnesses, including Diane Lebouthillier, minister of National Revenue; officials from the CRA including Stephanie Henderson, manager of offshore compliance; officials from the Department of Justice; and officials of KPMG.

The committee extended its hearings and, during the June 2016 proceedings, witnesses were asked not to comment on an offshore corporate structure developed by KPMG and located on the Isle of Man. The structure is the subject of hearings by the Tax Court of Canada and the federal court.

In asking the witnesses to limit their comments, the committee sought to avoid possible prejudice to the court cases.

The Standing Committee on Finance tabled its report, entitled “The Canada Revenue Agency, Tax Avoidance and Tax Evasion: Recommended Actions” on Oct. 26, 2016, and made 14 recommendations.

On Feb. 22 this year, the government provided a detailed response, addressing and supporting all 14 recommendations.