Tax centres to target tax cheats using offshore sites |
Date: Wednesday, August 10, 2005
Author: London Free Press
PETER GEIGEN-MILLER, Free Press Reporter
Canadians who use overseas tax havens to evade paying their fair share of taxes will be the target of a new London centre being established by Canada's tax agency.
Minister of National Revenue John McCallum was in the city yesterday to announce the London centre is one of 11 being established across Canada to go after tax cheats.
While only a small minority of Canadians are cheating on paying taxes, they place an unfair burden on other Canadians, said McCallum.
"In fact, they are stealing from honest taxpayers."
Each of the 11 centres will have a small team of audit experts drawn from the areas of international tax, special audits and tax avoidance.
The centres will develop new ways to track and combat "aggressive tax planning" and the use of international tax shelters.
Their goal is to define the scope and nature of abusive international financial transactions and to understand who participates in them.
Tax havens are places with no taxes or very low tax rates and laws that obscure the operation of their tax system.
There can be legitimate reasons for using an offshore haven, tax officials agree, but investing in them can provide Canadians with opportunities to evade taxes in Canada.
Technology and global markets have made it even easier for individuals and corporations to shift money offshore and evade their tax obligations in Canada, McCallum said.
He noted that income earned by Canadians anywhere in the world is taxable, regardless of the source.
"Our concern is where taxpayers do not report all of their income, exploiting bank secrecy laws in tax havens to conceal assets and income that are subject to tax."
The 11 centres are being paid for with $30 million in annual funding announced in the February budget.
Besides London, tax centres will be located in Halifax, Saint John, Laval, Montreal, Toronto, Ottawa, Winnipeg, Calgary, Vancouver and Burnaby.
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