Send a message to your MP now, asking him/her to support Bill C-621, An Act to Amend the Income Tax Act (economic substance). Let’s make sure corporations play by the same rules as the rest of us.
Canada’s Top 60 public companies have over 1000 tax haven subsidiaries or related companies. Canadians for Tax Fairness just published a report documenting Bay Street's Addiction to Tax Havens.
They use these subsidiaries to shift profits offshore in order to pay less tax. A popular practice is selling a patent or trade mark to an offshore subsidiary and then charging itself licensing fees for the use of that same patent or logo.
How does our tax system let this boondoggle happen?
Here’s how: Canada’s Income Tax Act is riddled with loopholes that legally allow companies to get away with paying less than their fair share. And tax treaties Canada has signed with tax havens facilitates Canadian companies shifting profits and allows them to bring money back tax free. The Paradise Papers leak shows how extensive Canadian use of tax havens it.
Tell your MP and the Finance Minister to stop corporate tax dodging.
Tell them a good first step is to support Victoria MP, Murray Rankin's Private Member's Bill (Bill C-362) that would require that offshore subsidiaries be required to have economic substance to be considered a separate legal entity for tax purposes. This amendment to the corporate tax law would go a long way to helping the CRA and the courts to crack down on corporations that game the tax system.
And ask them to press the government to re-negotiate tax treaties with tax havens to stop corporate tax dodging.
Send a message to your MP now, asking him/her to support Bill C-362 An Act to Amend the Income Tax Act (economic substance). Let’s make sure corporations play by the same rules as the rest of us.