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Results: 1 - 15 of 338
Dennis Howlett
View Dennis Howlett Profile
Dennis Howlett
2013-06-17 11:58
Thank you for the opportunity to share my views on Bill S-17.
The tax conventions and agreements included in Bill S-17 will be of very limited use in improving the recovery of taxes from those hiding their money in tax havens unless some key elements of the tax havens action plan proposed by British Prime Minister David Cameron at the G-8 summit are implemented. If Canada is serious about going after tax cheats who are using tax havens, then it should demonstrate this by fully supporting Prime Minister Cameron's action plan without trying to water down some of its key components.
In particular, the British proposals on beneficial ownership in multilateral automatic tax information exchanges are key to whether Bill S-17 will be a useful piece of legislation or a waste of time and effort.
Let me explain what I mean.
One of the problems with the tax conventions and agreements covered by Bill S-17 is that Canada needs to have quite a bit of information to begin with before it can request information under the current OECD bilateral agreement model that these agreements are based on, and we can clearly see this. If you look at the details in schedule 5 of Bill S-17, for example, you see all the steps that have to be taken in the case of Luxembourg to get the information Canada wants. It spells out quite clearly all the complicated steps involved.
It's similar to what the police have to go through to get a search warrant. As I'm sure Ms. Glover would be able to confirm from her experience, police have to have identified a suspect, and they need a fair bit of evidence in order to convince a judge to grant a search warrant.The challenge facing Canada Revenue Agency at the moment is that they have a very difficult time figuring out who their suspects might be and who they should be asking tax haven governments for more information on because of the banking secrecy that prevails in tax haven countries. How can Canada ask for information on a suspected tax evader if strict beneficial ownership rules are not applied? A tax evader can open trust accounts or set up shell companies in many tax havens without having to establish the ultimate beneficial owner. Without strong beneficial ownership rules in force, it's easy to hide your wealth offshore, and this facilitates not only tax evasion but also organized crime's money laundering, arms dealing, and financing of terrorism.
I am sure this government would not want to be accused of supporting such things.
The British G-8 tax haven action plan proposal on beneficial ownership calls for a public registry as well as much stronger rules to ensure the ultimate beneficial owner of any account. It's essential that beneficial ownership information be available in the public domain as opposed to being accessible only to police or tax authorities, because if it is available publicly it will be much easier for all countries to get access to this information. Multilateral automatic tax information exchange is the other key measure needed to make bilateral tax information exchange agreements useful. Proposals now under consideration at the G-8, G-20, and OECD would facilitate the exchange of basic information on account holders so that Canadian tax authorities would know when a taxpayer has not indicated on his or her tax return an offshore account in country X or Y, and then they would know who to go after, in terms of further investigation.
I know that the Canada Revenue Agency has come under a lot of criticism recently, including from our groups, but I actually have some sympathy for them given what they are up against. It's extremely difficult to undertake investigations on those who might be cheating on taxes using tax havens when they have very little to work with.
My final point is that there's a need to augment the capacity of the Canada Revenue Agency, especially given the recent leak of data that's now available to the Canadian government. The six or 10 additional people reported to have been assigned to a special unit will not be adequate to go through all the tax-leak data.
The CBC and the International Consortium of Investigative Journalists need to be commended for doing a major public service by exposing those who are using tax havens. It's imperative that Canada has the capacity to effectively follow up on that information.
Thank you.
Brian McCauley
View Brian McCauley Profile
Brian McCauley
2013-05-30 8:58
Thank you, Mr. Chair.
Actually, it's fairly straightforward. If the original wording of the bill had remained, it would have meant there were no consequences for the firm. Let's say a fee was established at $5,000 and they charged $5,500. The $500 would have been the penalty, but there's really nothing at risk for them, in as much as they would have paid that back. There would be no consequence beyond that for them. It really wouldn't have been a penalty.
I think the amendment simply adds $1,000 to that, so there is some real consequence. Otherwise, it would be a very small risk to the business.
Suzanne Legault
View Suzanne Legault Profile
Suzanne Legault
2013-05-08 16:06
Good afternoon, Mr. Chair and members of the committee.
I'm accompanied today by Layla Michaud, who is my director general of corporate services and the office's chief financial officer.
I will briefly review my office's achievements, our priorities for the next year, and some of the challenges we face.
Overall, I'm must say that I'm very proud of the incredible work being done by my very dedicated staff.
In 2013-14, we will have $10.5 million available to carry out our work. An added $2.6 million was provided to my office to cover the costs of relocating our offices next fall. We must repay this increase in appropriations over 15 years. In the 2014-15 fiscal year, our budget will be just under $10 million, which includes a $500,000 reduction as a result of the deficit reduction action plan. By the end of 2014-15, we will have fully implemented the budget 2012 cuts and the cost containment measures, which in total will amount to 8% of our budget.
For 2013-14, 77% of our financial resources have been allocated to our program and 23% to our corporate services. In terms of our human resources, I have 93 full-time equivalents on staff, down from 106 at this time last year. Of the 93, 70 work for the program and 23 for corporate services.
As you know, over the last four years, I have made significant changes to streamline our entire operations. I think the results are very positive.
On the program side, we have resolved 7,300 complaints since April 2009, including some of our oldest and most complex cases that had accumulated over the years. For a fourth year in a row, we have completed more files than we received during the year. Our median turnaround time is now 215 days and, more importantly, 86 days from the day cases are assigned to an investigator. I have strengthened our legal capacity to assist with formal investigations and litigations. That helped reduce our outsourcing costs for legal expertise.
In internal services, we are completing our information management and information technologies strategy, which we began four years ago. In the past year, I have also outsourced all our human resources activities to Shared Services Canada.
As you have seen from my report on plans and priorities, I have set ambitious performance targets for our program, and our internal services will be facing a challenging year in 2013-14.
That being said, my focus remains on the realization of the key results area of my strategic plan, which will be in its third and final year. I will hence, in this fiscal year, renew this strategic direction for the following three years, to lead the OIC through to the end of my mandate in 2017.
On developing a leading access to information regime, my focus in the next fiscal year will be to complete our three systemic investigations: into consultations, interference with the access to information process, and on text-based messaging. I also plan to complete the investigation I launched recently in response to the environmental law clinic complaint.
To coincide with the 30th anniversary of the Access to Information Act, and building on 30 years of experience at the OIC, we will issue recommendations for modernizing the act by way of a special report to Parliament in the fall of 2013.
We will continue to strive to provide exemplary services to Canadians. As you saw in our report on plans and priorities, I have a dedicated team, with difficult targets. Those targets are to complete 85% of the administrative complaints within 90 days and 75% of priority or early resolution complaints within six months. My goal is to leave, at the end of my term, a manageable and up-to-date inventory of cases to my successor.
As part of our work in this regard, we will target the complaints in our inventory that deal with special delegations—national security, the Canadian Broadcasting Corporation and the Canada Revenue Agency. We will also continue to work towards the resolution of the oldest complaints in our inventory and to closely follow the progress of our investigations.
In addition, we will keep seeking ways to be an exceptional workplace. To that end, we will roll out a comprehensive talent management program, a new human resources plan, as well as a code of values and ethics, with excellence in all aspects of our work as our goal.
Our internal services will be responsible for the relocation of our office in the fall, the completion of our information management and information technologies strategy, and for exploring further the opportunities for shared services with other agents of Parliament.
Mr. Chair, one of the fundamental principles underpinning access to information is having an independent oversight of government decisions on disclosure. The Access to Information Act explicitly prescribes that the Information Commissioner “shall receive and investigate”—it's a positive legal obligation, which leaves me no discretion—the complaints of individuals who believe that their rights under the act have not been respected.
Even though I was able to decrease my inventory of complaints by close to 29% in the last four years, I still have about 2,000 files in my inventory at this time. At the same time, we are receiving more administrative complaints. We are up by 38% in the last fiscal year. In the last month alone, in April 2013, my office registered 277 complaints. The additional efficiencies I can now make will remain marginal.
When I appeared last year on the 2012-13 main estimates, I did not know whether my office's budget would be cut. In a letter to the Minister of Justice at the time, I wrote:
The overall conclusions of my review indicate that any reductions to the Office's existing funding envelope will potentially have significant adverse impacts on program results, including eroding the significant progress made over the last two years in reducing the inventory of longstanding cases and our ability to deal with the demands of our current inventory.
Hence, if you ask me today the question whether my budget is enough to accomplish my mandate, my answer is no.
In the coming months I will continue, however, to work to improve our performance to meet our ambitious targets, but I will also—and I feel I must—be seeking additional funds to ensure that the Office of the Information Commissioner can meet its obligations under the act. Frankly, Mr. Chair, I think if I did not do that, I would be acting irresponsibly.
With that, Mr. Chair, my colleague and I are here to answer your questions.
View Scott Andrews Profile
Ind. (NL)
View Scott Andrews Profile
2013-05-08 16:24
Thank you.
Welcome back, Commissioner.
You mentioned in a previous question that 30% of your complaints come from CRA. What are the others—the top three? If CRA is 30%, what are the percentages for the other top ones?
Suzanne Legault
View Suzanne Legault Profile
Suzanne Legault
2013-05-08 16:24
The three main groups are really CBC, CRA, and anything having to do with special delegation. These are national security matters. Those three groups basically account for 50% or so of our inventory of cases. I do have a list somewhere here of how they're broken down in terms of institutions.
Essentially, over the last four years, about 18 institutions compose our inventory of complaints. It's fairly small if you consider the total number of institutions that are covered by the act. There's a top tier, really, of 20 institutions that generate the most requests, that generate the most complaints, and that have information holdings that obviously are of more interest to requesters.
View Scott Andrews Profile
Ind. (NL)
View Scott Andrews Profile
2013-05-08 16:26
For some of these bigger departments, like CRA, is there anything they can learn from the other departments? Would it be a useful idea to send in some of the representatives from the other departments who do very well at clearing off these requests?
Suzanne Legault
View Suzanne Legault Profile
Suzanne Legault
2013-05-08 16:27
Yes, I think there are best practices, but in those institutions that have a lot of requests and a lot of complaints, we find that they're very different. Citizenship and Immigration Canada gets a lot of requests from lawyers who are representing people who want to have information about their immigration status or refugee status, and a lot of the time their requests are fairly small, in terms of number of pages, and the exemptions that are being applied are very much the same, like personal information.
If you look at CRA, it's a different dynamic. They have some requesters who make a large number of requests to them, and they have a very high volume of pages—over a million pages in the last year.
So their realities are different. We try to work with them, depending on their different realities. In terms of CRA, we have regular meetings. I have met with the head of CRA, the new person at the head of the agency, to make sure there's a commitment. We're trying to convince them to look at any ways they can reduce the number of requests by proactive disclosure. I know this is something that they said they were going to look at. They have a specific reality in terms of tax assessments and parallel litigation, so it's a different type of environment.
View Scott Andrews Profile
Ind. (NL)
Suzanne Legault
View Suzanne Legault Profile
Suzanne Legault
2013-05-08 16:28
They have a lot of requests. I think they are committed to their work. We have an excellent relationship with the Canada Revenue Agency and all of the access professionals there. We have lists of priorities that we work with them on. To manage their requests, they have increased their component of access professionals threefold in the last few years.
CRA is an institution that has a large volume of requests, a large volume of complaints, some specific large-volume complainants as well, and they are very collaborative with our office.
View James Rajotte Profile
CPC (AB)
I call this meeting to order.
This is meeting number 120 of the Standing Committee on Finance. Our orders of the day for the first hour are pursuant to Standing Order 81(4). We are dealing with the main estimates 2013-14, votes 1 and 5 under the Canada Revenue Agency, referred to the committee on Monday, February 25, 2013.
Colleagues, we're very pleased to have two officials from the Canada Revenue Agency here with us for the first hour this morning. We have Mr. Mark Perlman, acting chief financial officer and assistant commissioner, finance and administration branch. We also have Mr. Richard Case, acting deputy assistant commissioner and agency comptroller, finance and administration branch.
Welcome to both of you gentlemen.
Mr. Perlman, I believe you have the opening statement, and then we'll have questions from members.
Mark Perlman
View Mark Perlman Profile
Mark Perlman
2013-05-07 8:46
Thank you, Mr. Chair.
Good morning, and thank you for the opportunity to appear before the committee to present, and to answer any questions you may have on the Canada Revenue Agency's 2013-14 main estimates.
Mr. Chair, as you know, the Canada Revenue Agency is responsible for the administration of federal and certain provincial and territorial tax programs, as well as the delivery of a number of benefit payment programs.
Every year, the agency collects hundreds of billions of dollars in tax revenue for the Government of Canada, and distributes timely and accurate benefit payments to millions of Canadians.
In order to fulfill its mandate, the CRA is seeking the approval of a total of $4.3 billion in resources through these 2013-14 main estimates. This represents a net decrease of about $98.1 million, or 2.2%, when compared with the 2013 main estimates authorities. This net increase is made up of a number of changes, but in total, $132.8 million in decreases are offset by $34.7 million in individual increases. The $132.8 million in decreases to the agency's budget are comprised of the following items. A reduction of $56.3 million is as a result of savings identified as part of the budget 2012 spending review. Most of the savings measures can be categorized under two broad categories, mainly making it easier for Canadians and businesses to deal with government and modernizing and reducing the CRA's back office.
Secondly, the agency's 2013-14 budgets also reflect a planned reduction of $31.3 million related to the completion of start-up activities for the implementation of the harmonized sales tax for Ontario and British Columbia as well as the new affordable living tax credit for Nova Scotia.
Furthermore, effective April 1, 2013, the agency is no longer responsible for administering the harmonized sales tax on behalf of British Columbia. As a result, a total of $19.1 million is being returned to the Treasury Board through these estimates.
These main estimates also reflect a decrease of $1.5 million from last year's estimates for the government advertising programs. This brings CRA's total advertising budget for the 2013 tax filing season to $6 million.
The remaining $24.6 million decrease consists of miscellaneous items, such as $13 million less in revenues for cost-recovered services provided by Canada Revenue Agency to various organizations pursuant to section 60 of the Canada Revenue Act; the sum of $5.8 million in planned funding reductions for various initiatives announced in the 2009, 2010, and 2011 federal budgets; an amount of $3.6 million in lower employee benefit plan rates; and finally, $2.2 million in planned reductions for the administration of the corporate tax in Ontario.
Offsetting these decreases, the agency's budgets will be increased by $34.7 million for a number of initiatives that I will briefly address as follows. There is an additional $14 million in 2013-14 as part of the multi-year upgrade of CRA's personal income tax processing system. This system is integral to the delivery of CRA programs and services to Canadians, providing Canada, the provinces, and the territories with their principal source of revenue. This system also enables the termination of eligibility for individual Canadians who receive benefit payments and tax credits each year. These upgrades will leave the CRA in a better position to address increased numbers of tax filers, respond to new tax policy measures, and implement new partnership agreements with provinces, territories, and other government departments and agencies.
In addition, the agency is requesting a $10.9-million adjustment in the transfer from Public Works and Government Services Canada related to accommodation and real property services.
The statutory payments for the children's special allowance are also expected to grow by $5 million, from $233 million in 2012-13 to $238 million in 2013-14. This is due to increases in both the numbers of children for whom payments are expected to be made and the monthly payment per eligible child.
The 2013-14 main estimates also reflect a $3 million increase in statutory disbursements to the provinces under the Softwood Lumber Products Export Charge Act, 2006. These projected increases reflect a revised forecast provided by the Department of Finance based on historic averages as well as forecasts of U.S. prices and volumes.
The final increases relate to an adjustment of $2.5 million in the amount previously transferred to Shared Services Canada when it was created, as well as $0.1 million in other miscellaneous items.
Overall, these main estimates display a net increase of $98.1 million when compared with the 2012-13 main estimates granted by Parliament. The CRA's revised authorities for 2013-14 will therefore total $4.276 billion. Of this amount, $3.1 billion requires approval by Parliament, whereas the remaining $1.2 billion represents a statutory forecast already approved under separate legislation.
The statutory items include softwood lumber disbursements to the provinces, the children's special allowance payments, the employee benefit plan costs, and the section 60 spending of revenues received through the conduct of CRA operations.
Mr. Chair, at this time my colleague and I would be pleased to respond to any questions you may have on the CRA's 2013-14 main estimates.
Thank you.
View Peggy Nash Profile
NDP (ON)
Thank you, Mr. Chair, and good morning to the officials. Thank you for being here.
My questioning is around the reductions in expenditures you have outlined and what that means for tax enforcement at CRA. I know that staffing has declined from a peak of 460 full-time positions in the international audit program in 2009 to about 422 positions. I'm wondering how this department will be further impacted. Will there be increased ability to do international tax auditing? In this committee we've been studying cracking down on tax havens, so I'm wondering about the international tax compliance element.
Mark Perlman
View Mark Perlman Profile
Mark Perlman
2013-05-07 8:53
I want to start by giving a bit of background about the spending review. When the government announced the $5.2 billion reduction, the CRA, as one of Canada's largest federal government organizations, had to do its part in contributing to the reduction of the federal deficit. Our part is the contribution of about 6.9% overall.
To answer your question directly, the CRA has been focusing its attention on administrative savings or activities that are of lower priority while maintaining its attention on higher-priority items such as international tax evasion and aggressive tax planning.
I want to assure the committee that the CRA is not weakening its efforts in audit enforcement. In fact, that is a priority area. Whenever we do our budgets going forward, these are the areas we tend to invest in.
In answer to your question, I believe the numbers you're quoting came out of question 1174, which should answer a number of the questions about aggressive tax planning and international tax evasion. If the committee would like, that question can be made available for distribution.
View Peggy Nash Profile
NDP (ON)
Oh, great.
I'd like to follow up on that. It's our understanding—and maybe you can correct this impression—that the CRA plans to eliminate another 3,000 positions. Can you verify whether this is correct?
Mark Perlman
View Mark Perlman Profile
Mark Perlman
2013-05-07 8:55
That is the answer that's in question 1174. I can start with, if we want to go there—
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