CRA Silent While Other Countries Prosecute Tax Dodgers

Remember the Panama Papers?

The two lawyers who run the law firm at the centre of it have been arrested in Panama and charged with money laundering. Which begs the question: Since countries all over the world have started prosecutions based on Panama Papers documents, what is happening at the Canada Revenue Agency? 

The CRA has 2,600 documents from the Panama Papers database. Late last year, CRA officials also confirmed to the Toronto Star that they obtained tens of thousands more supporting documents from foreign governments and court orders to aid the investigations.

“Canadians deserve to know if any of the 85 Canadians whose names appeared in the Mossack Fonseca files will be prosecuted for offshore activity,” says Dennis Howlett, executive director of Canadians for Tax Fairness. “Many wealthy tax dodgers settle quietly out of court and never face the full consequence. If the CRA is serious about cracking down, it should be up front and detailed about their game plan or  if they have made any deals." 

Late last year, CRA Minister Diane Lebouthillier confirmed tax evasion investigations into 60 of the 85 Canadians identified in the Panama Papers leak. Since then, the CRA has been secretive about any progress. It cites concerns about confidentiality provisions as the reason. When Canadians for Tax Fairness conducted an initial search, it appeared that none of the investigations have resulted in referring cases to the Public Prosecution Service of Canada where charges could be laid.

“Canadians understand about the need to respect the rights of the people being investigated,” says Howlett. “But with countries all over the world prosecuting tax dodgers connected with Mossack Fonseca, it is time for some accountability from the CRA.”

Earlier this month, a report for the European Parliament based on the Panama Leaks database found that the Royal Bank of Canada had requested the creation of more than 1200 offshore companies. The report echoes the concerns of Canadians for Tax Fairness about the role of advisors and intermediaries in the use of offshore tax havens. Eight of the top 20 international “fixers” were banks including RBC and Swiss banks Credit Suisse and UBS. All four accounting giants including KPMG were named in the report. 

“Wealthy tax dodgers would not be able to funnel money offshore without these enablers,” says Howlett. The Panama Papers shines a light on the role of the legal and accounting profession in these shady dealings."

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Thank you. The Tax Fairness Team.