CRA setting its sights on suspected tax cheats
Agency after $4.4 billion
OTTAWA – The federal government is claiming $4.4 billion from Canadians and corporations suspected of cheating the taxman by hiding their money, notably in offshore tax havens.
“The gross number is $4.4 billion at this moment. It’s many years ahead of schedule, but it remains the gross number,” said Ted Gallivan, assistant commissioner of international, large business and investigations branch at the Canada Revenue Agency.
Gallivan was responding to a question from Bloc Québécois MP Julie Vignola during a virtual meeting of the House of Commons Committee on Government Operations and Estimates on Monday.
Vignola asked both CRA and the Minister of National Revenue Diane Lebouthillier to detail the results of over $1 billion in investments by the Liberal government to fight tax fraud and offshore tax evasion since 2015.
How many Canadian companies and individuals does that $4.4 billion involve? And how far back do those claims go? And what were the CRA’s claims targets that the agency is now “many years ahead of schedule” on?
Gallivan wasn’t asked to answer any of those questions by MPs, and the assistant commissioner was not available for an interview in the hours following the meeting.
But that $4.4 billion is far from won for Canada’s tax agency. Tax evasion cases, particularly when they involve wealthy individuals and corporations, often lead to notoriously long and difficult court fights for the CRA.
And that’s no different today, said Gallivan, who emphasized many times that $4.4 billion remains the gross amount, not the amount ultimately recouped by the agency.
“We still have a lot of cases that are in front of the courts, over 3,000 of them in fact. A lot of these inquiries will be resolved by the courts, but as of now, the gross amount is $4.4 billion,” Gallivan explained to MPs.
In many court cases, judges will end up awarding the government less than it asked for — when it wins.
“I think it might be reasonable to expect the CRA might get half of that based on past experience,” said Toby Sanger, executive director of Canadians for Tax Fairness.
“Obviously you need that tougher legislation. We do need stricter enforcement, but as the CRA keeps on losing, or has lost some significant cases, we definitely need stronger legislation on this and reform of international corporate rules,” he said.