From: AlanBaggett@volcanomail.com   
      
   Canada Has A Two-Tier Tax System And CRA Is Part Of The Problem :CRA SOTW   
      
   Guy Caron, Member of Parliament (NDP) Rimouski-Neigette-Témiscouata-Les   
   Basques   
      
   In regards to tax evasion and aggressive tax avoidance, the Canada Revenue   
   Agency (CRA) should be part of the solution. At the moment, it rather seems to   
   be part of the problem.   
      
   Over the last few years, we have seen that the CRA institutionalized various   
   practices, eroding the trust that Canadians place in it. Among these   
   practices, we find:    
      
      
   1. Double standard in the assessment of penalties   
      
   The KPMG scheme at the Isle of Man has shown that when affluent people try to   
   evade taxes through dubious schemes, they are given a second chance. They can,   
   through a "voluntary disclosure program" admit to their cheating after which   
   they are asked to    
   pay back the money they owe in taxes. No interest, no penalty. On the other   
   hand, ordinary Canadians are assessed penalties doubling or tripling the   
   amount due for good faith errors.   
      
      
   2. Double standard in the protection of anonymity    
      
   We can't find the identity of those affluent Canadians or corporations who   
   have settled with the CRA through various schemes, like KPMG. The CRA says it   
   must protect their "privacy." But ordinary Canadians are regularly named and   
   shamed on its website.   
      
   In addition, last February, it was revealed that the Canadian Security   
   Intelligence Service (CSIS) got illegal access to private information on some   
   taxpayers, without a warrant. Last fall, the CRA transmitted over 150,000   
   banking records to the U.S.    
   Internal Revenue Service without informing the account holders, and while a   
   court challenge initiated by the Privacy Commissioner was ongoing.   
      
      
   3. Close proximity with the circles of financial power   
      
   We have found out that auditors of the CRA were wined and dined by large   
   firms. Some CRA auditors were hired by large consulting firms at a time when   
   they were audited. And let's not forget that case involving CRA employees in   
   the Montreal office, who    
   worked to give a $400,000 income tax refund to a well-known mobster who   
   actually owed $1.5 million in taxes, despite all the supposed control measures   
   in place.   
      
      
   4. Dubious priorities   
      
   In 2012, the CRA started an $8-million project of auditing Canadian charities,   
   a measure that still goes on despite the Liberal commitment to end the   
   project. Progressive organisations, such as environmental groups, churches and   
   social justice    
   organisations are disproportionately targeted. These groups have been told   
   their charitable status would be threatened if their mandate was to "work for   
   justice in the world" or "work for the prevention of poverty," which are   
   interpreted as "political    
   activities" by the CRA.   
      
      
   5. Culture of secrecy   
      
   It is close to impossible for parliamentarians to know what's going on at the   
   Canada Revenue Agency. At every turn, when questions are asked, we are told we   
   cannot get answers because (choose your pick): (1) privacy issues; (2) a case   
   is before the    
   courts; (3) they cannot comment on internal investigations; (4) they cannot   
   identify CRA employees working on a specific case... This makes the CRA a   
   shadowy agency working outside the confines of parliamentary democracy.   
      
   Alan Freeman, a former Assistant Deputy Minister at the Finance Department,   
   did not mince words when describing the workings of the CRA, in a column   
   entitled "The Canada Revenue Agency is rotten to the core. Time to clean   
   house."   
      
   "My late father -- who was about as straight an arrow as they come -- told me   
   once how the Americans treat tax evasion. 'In the U.S., if you dodge taxes,   
   the IRS will get you thrown in jail. In Canada, you can always make a deal   
   with Revenue Canada. They    
   just want the cash.'"   
      
   As I wrote last week, despite the government's claim of 44 convictions for   
   criminal tax evasion involving tax havens between 2006 and 2012, most of them   
   had nothing to do with assets hidden in tax havens. Largely, Canada doesn't   
   prosecute, it simply    
   wants the cash.   
      
   And speaking of cash, the Canadian government's position is that we are   
   recouping more money than ever. According to the CRA, in 2015 to 2016, there   
   were 10,748 voluntary disclosures involving offshore accounts, totaling $938   
   million in unreported income.   
    In 2013 to 14, there were only 5,248. We can argue that the increased number   
   of voluntary disclosure is a direct consequence of the number of high-profile   
   leaks, and not of the efficiency of the agency.   
      
   It has taken six years to investigate the 106 accounts of the 2007   
   Liechtenstein tax scandal, to collect a mere $8 million in taxes owed. This   
   led Senator Percy Downe to jest that at that rate, it would take over 118   
   years to audit the list of accounts    
   in the Swiss HSBC affair.   
      
   Part of the problems at the CRA can be traced to the $250-million budget cuts   
   it experienced in the last five years. But it doesn't explain it all...   
      
   It certainly doesn't explain how the Canada Revenue Agency went from being a   
   watchdog ensuring everyone pays their fair share to enabler of a two-tier tax   
   justice system.   
      
   ----------------------------------------------------------    
   Miss a Tax Tale Miss a lot!    
   Visit the CRA SOTW Library at http://canada.revenue.agency.angelfire.com    
   ------------------------------------------------------------    
   Alan Baggett - http://www.taxcollectorsbible.com/ - Tax Collector's Bible    
      
   --- SoupGate-Win32 v1.05   
    * Origin: you cannot sedate... all the things you hate (1:229/2)