Se­na­tor’s cru­sade

The Compass - - EDITORIAL - This edi­to­rial orig­i­nally ap­peared in The Tele­gram

Lib­eral Sen. Percy Downe has been a voice in the wilder­ness. The Prince Ed­ward Is­land se­na­tor was on a lonely mis­sion for years, speak­ing across Canada, in the United States and Europe about off­shore tax shel­ters. Those havens make it easy for the rich and pow­er­ful to evade pay­ing their fair share of taxes.

Downe is up­set that Cana­dian tax cheats have robbed us of bil­lions of dol­lars. Each time he wrote a com­men­tary about the fail­ures of the federal gov­ern­ment and the Canada Rev­enue Agency (CRA) to track down these cheats, he was ridiculed.

Es­ti­mates sug­gest the taxes owed from off­shore ac­counts amount to at least $4 bil­lion and could be more than $10 bil­lion.

The agency ap­par­ently doesn’t like any­one snoop­ing into its poli­cies. We still don’t know what the tax gap ac­tu­ally is - the dif­fer­ence be­tween what Cana­di­ans owe in tax and what the federal gov­ern­ment ac­tu­ally col­lects.

Ear­lier this year, the CRA came un­der fierce crit­i­cism for of­fer­ing an amnesty to wealthy clients of a Cana­dian in­vest­ment firm caught us­ing an off­shore tax-avoid­ance scheme. The CRA breached its own guide­lines by of­fer­ing the amnesty.

Many Cana­di­ans can’t re­late to the foibles of the rich. To uti­lize off­shore ac­counts, you need lots of money. Since most of us don’t have ex­tra cash, we don’t care. That should change. The “tax gap” phrase is trend­ing to­day be­cause it’s sud­denly be­come very sexy. In the re­cent federal bud­get, the gov­ern­ment ear­marked over $400 mil­lion to help col­lect bil­lions of dol­lars owed through eva­sion or avoid­ance.

This week we were hit with a dou­ble whammy. The leak of the Panama Papers thrust the at­ten­tion of the world on vast tax shel­ters op­er­at­ing in the Cen­tral Amer­i­can coun­try.

The scan­dal has en­snared gov­ern­ment of­fi­cials in Ice­land and Bri­tain, mem­bers of the Royal Fam­ily, sports stars, busi­ness ty­coons and en­ter­tain­ment celebri­ties around the world.

If po­lit­i­cal lead­ers are the ones ben­e­fit­ing from off­shore ac­counts, it’s lit­tle won­der that jus­tice has moved slowly.

Last week in Mon­treal, Prime Min­is­ter Justin Trudeau made a de­fin­i­tive state­ment on tax cheats. He called for the in­ter­na­tional com­mu­nity to work to­gether to make global fi­nance more trans­par­ent and ac­count­able. Oth­er­wise, rich in­vestors ex­posed in Panama will sim­ply hop around to the next tax shel­ter. It’s time for a global, off­shore tax eva­sion crack­down. It all must be music to Downe’s ears. Just think what that ex­tra cash might mean for the prov­inces and the coun­try.

It could mean federal help for much­needed new re­gional hos­pi­tals. It could pour more money into in­fra­struc­ture projects across the na­tion, and im­prove ed­u­ca­tion, hous­ing and util­i­ties for many First Na­tions com­mu­ni­ties, which are in des­per­ate need. It would re­duce the deficit.

It’s tax time. The vast ma­jor­ity of Cana­di­ans feel it’s im­por­tant that every­one pay their fair share of tax. Most of us will do ex­actly that.

We’ve had enough of tax cheats. And of the rich get­ting richer - il­le­gally.

Just think what that ex­tra cash might mean for the prov­inces and the coun­try.

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