OTTAWA, CANADA--(Marketwired - Dec. 8, 2016) - Canada Revenue Agency
Canadians work hard for their money and the vast majority pay their fair share of taxes. But there are still too many wealthy Canadians who continue to find ways to not pay what they owe. This is not fair and robs all Canadians of the resources necessary to support the valuable social programs available in this country. That is why the Government of Canada is working hard to crack down on tax avoidance and tax evasion, in order to ensure a tax system that is more responsive and fair for all Canadians.
The Honourable Diane Lebouthillier, Minister of National Revenue, this week received the Offshore Compliance Advisory Committee's (OCAC) first report, on the subject of the Canada Revenue Agency's (CRA) Voluntary Disclosures Program (VDP). The Committee supports the VDP as an integral part of the CRA's administrative and enforcement regime and offers recommendations to enhance it and improve it for the benefit of Canadians. Minister Lebouthillier welcomed the overall tightening of the VDP to ensure fairness of the tax system, notably in order to limit the repeated use of this program by sophisticated taxpayers who wish to minimize what they owe and restrict the circumstances in which it can be used. The Minister and the CRA will leverage the OCAC's recommendations to review the VDP parameters. Changes will be communicated in late 2017.
The VDP, which provides Canadians with an opportunity to correct their tax affairs, was identified as the initial area of focus for the OCAC. In the course of its study, the Committee met with CRA officials to more fully understand the breadth of the program currently in place in Canada and also reviewed literature from other countries where similar programs exist.
Minister Lebouthillier also took the opportunity to thank the OCAC members for their contributions and highlighted their unique experience and viewpoints. As the Government of Canada prepares its response to the House of Commons' Standing Committee on Finance's report, "The Canada Revenue Agency's Efforts to Combat Tax Avoidance and Evasion," the insight provided by the Committee is timely. It will help inform the CRA's next steps, including evaluating the scope of the program, the circumstances surrounding disclosure and how much relief individuals may be entitled to receive.
Announced by Minister Lebouthillier on April 11, 2016 to build on the measures announced in Budget 2016, the OCAC, an independent panel of experts with legal and tax backgrounds, was established with the mandate to advise the Minister of National Revenue and the CRA on current and future administrative strategies to tackle offshore tax evasion and tax avoidance.
"I welcome the Offshore Compliance Advisory Committee's first report and wish to thank the committee for its unique insight and for providing its invaluable experience to help improve the tax system for the benefit of hard-working middle class Canadians."
"Our government has made it a priority to make the tax system fairer for middle class Canadians and to crack down on those who cheat and who do not pay their share. That is why we created the Offshore Compliance Advisory Committee - to advise us on the best ways to improve our tax system. We will continue with our efforts to crack down on tax cheats. My message is clear: the trap is closing."
- The Honourable Diane Lebouthillier, P.C., M.P., Minister of National Revenue
- With the investment of $444 million over 5 years announced this past spring, the CRA is increasing its resources and tools to crack down on tax cheats both in Canada and abroad. That includes the implementation of a new strategy in which it reviews all international electronic funds transfers (EFTs) over $10,000 between Canada and four foreign jurisdictions in a given year.
- The first two jurisdictions that were reviewed were the Isle of Man and the island of Guernsey. The reviews for these two jurisdictions are almost complete.
- The reviews of two more jurisdictions are underway and will be completed by the end of March 2017.
- As of the most recent quarterly update on September 30, 2016, over 20,000 EFTS have been examined, worth a total of about $7 billion.
- Work is ongoing and the CRA is on track to recoup the additional $2.6 billion in revenue it had targeted when the investment was announced.
Report on the Voluntary Disclosures Program
Statement from the Honourable Diane Lebouthillier, Minister of National Revenue
Government of Canada cracks down on tax evasion
Backgrounder: Offshore Compliance Advisory Committee
Cracking Down on Tax Evasion and Tax Avoidance
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