Committee
Consult the user guide
For assistance, please contact us
Consult the user guide
For assistance, please contact us
Add search criteria
Results: 1 - 15 of 223
View Pierre-Luc Dusseault Profile
NDP (QC)
Thank you, Mr. Chair.
Thank you to the witnesses for being here today. I am very disappointed that the minister did not give us the opportunity to ask her questions. She came to testify about the main estimates for 2016-17, 2017-18 and 2018-19, but she did not want to appear before our committee to defend the 2019-20 main estimates.
That being said, I would now like to turn to the KPMG case. You probably expected that. I discussed this with you, Mr. Gallivan, as recently as last February. I don't know if you're the one who can answer my questions. You made the following comments at the time, which are public:
Then there's the fact that some participants [in the KPMG case] objected to the Tax Court of Canada. It will be up to the judges of that court to decide whether the behaviour of those participants was consistent with the law.
Last week, we learned that the Canada Revenue Agency had reached an agreement, an out-of-court settlement, to close the file. In the end, no judge will have pronounced on the behaviour of these participants. Yet the minister said that there was no amnesty in the KPMG case and that there would never be one. However, for me, this corresponds more or less exactly to the definition of an amnesty. We may not agree on that.
In any event, I would like to know who, in the KPMG case, made the decision to settle out of court with these participants.
Ted Gallivan
View Ted Gallivan Profile
Ted Gallivan
2019-06-11 11:43
I would like to begin by noting that this file was the responsibility of the appeals branch, but that several sectors of the agency were consulted to reach this conclusion.
We do not consider amicable settlements to be amnesties. This aspect of the dispute is not optional. A settlement process is followed. When a taxpayer makes an offer that eliminates the risk of the agency losing everything, we have an obligation to resolve the matter.
The minister has made it clear that lack of transparency is a concern for her. We want to adopt a more formal approach that emphasizes transparency. When you don't have all the details, you have to debate whether or not it's an amnesty. That is why the minister asked that the agency find a way to increase transparency.
With regard to the KPMG case, on the strategic side, taxpayers no longer resort to such a scheme. I can confirm that, to date, we have identified $24 million in contributions from these taxpayers. There are still a few taxpayers who are challenging this in court. Our employees analyze the facts and risks and then make the best possible decision.
I can assure you that decisions are made as a team, not by one or two employees, in secret. They are based on the law and the facts of the case, as well as our expectations of court decisions. The Tax Court of Canada is a specialized court in Canada. The judges of this court give us some good clues as to what we can expect.
View Pierre-Luc Dusseault Profile
NDP (QC)
So it is the appeals branch, in consultation...
Was the minister informed before this was signed? If so, when?
Ted Gallivan
View Ted Gallivan Profile
Ted Gallivan
2019-06-11 11:46
I do not think the minister was informed. However, I cannot say that because that does not fall under my purview.
View Pierre-Luc Dusseault Profile
NDP (QC)
In her comments, the minister said that in her view this settlement was not appropriate; her opinion is clear. She said that it lacked transparency, and I think we all agree on that. Obviously, she does not control what happens in her department.
Can you say that this is an independent decision made by the agency, when it should instead make this case an example to send a clear message to all Canadians that cheating is criminal?
View Pierre-Luc Dusseault Profile
NDP (QC)
This is the worst case for an amicable settlement. I cannot understand why the minister was not informed and did not oppose such a settlement.
Ted Gallivan
View Ted Gallivan Profile
Ted Gallivan
2019-06-11 11:47
The minister's role is to establish the approach to be followed by the agency.
I am responsible for audit programs. We have a protocol to follow for settlements, which is published on our website. We use criteria to make our decisions. For example, if it is an extreme case, we reserve the right to refuse.
The minister made sure that the procedure was followed and that the delegation to the committee was based on the established criteria, as is her role. It would be unusual for a minister to interfere with a specific decision.
I can assure you that several points of view, including the one you are now making, were taken into consideration. We considered other factors, such as the likelihood of a judge ruling in our favour, the precedent a judgment would set and the costs associated with it. All these factors...
Ted Gallivan
View Ted Gallivan Profile
Ted Gallivan
2019-06-11 11:48
The agency is not always pleased with the judges' decision.
View Pierre-Luc Dusseault Profile
NDP (QC)
Thank you, Mr. Chair.
The waiting time may be 10 or 15 minutes, but this only applies to half of the incoming calls, those who manage to get a line. For the other half, the system rejects them outright. However, I don't want to come back to this subject.
I would rather go back to the KPMG case, on which I have some questions. We said that the process was not transparent and that the final result was uncertain. You did not seem convinced that the judge would rule in favour of the Canada Revenue Agency in this case.
Yet, the scheme in question is considered by everyone, the general public and even experts, as one of the most flagrant examples of dubious and abusive schemes. I do not have any quotes from experts to hand at this precise moment, but I know that there have been several who have spoken out to that effect.
However, you are saying today that you were not sure of the decision the judge was going to make. Given that this scheme was so abusive and so clearly out of line, could you explain your lack of certainty?
Ted Gallivan
View Ted Gallivan Profile
Ted Gallivan
2019-06-11 12:21
As a general rule—and I am therefore not just talking about the KPMG case here—the court relies on the evidence and arguments of the Crown and taxpayers. The judge in charge asks questions, tries to shed light on the case and encourages the parties to reach a settlement. With the assistance of the Department of Justice and with the judges' comments in mind, we conduct a risk assessment to see if we could lose our case in relation to the tax years we are targeting, the penalties we want or our opinion that it is income and not capital gains. We then do an internal assessment.
In the KPMG case, I can tell you that we concluded that there was a probable outcome based on all this information. However, the possibility of a better settlement arose and the agency determined that it was beneficial to the public.
We consider precedents and evidence. Some knowledgeable taxpayers may object to our audits. We must therefore present evidence and data to support our case. Sometimes it's like doing risk management and seeing if it's worth it to proceed.
View Pierre-Luc Dusseault Profile
NDP (QC)
So the answer is no. It's not about words or using a magic wand, but about reality and the facts. It's simply no. Is that correct? I'll take that as a yes.
I have another question about the progress being made on another issue: the KPMG case. Three years ago, the Minister of National Revenue constantly told us that everyone was going to be prosecuted, justice would be served, no one would escape justice and the people responsible would be made to pay.
Can you give us a progress report on the KPMG case and tell us whether the firm, and not just its clients, will suffer the consequences of its actions, which you and I both know have been publicly exposed?
Ted Gallivan
View Ted Gallivan Profile
Ted Gallivan
2019-02-28 11:43
That's a very pointed question.
There are two elements. First, we've already established the identities of all the clients. There has been a lack of cooperation by some of the individuals identified, but the audit is under way. The audit process is still under way due to the complex nature of some cases. We're satisfied we can uncover all those involved and audit them.
Then there's the fact that some participants objected to the Tax Court of Canada. It will be up to the judges of that court to decide whether the behaviour of those participants was consistent with the law. As for KPMG, we're still considering our options as to what penalties should be imposed on it. We're still gathering facts through our audits, and that's helping us see what options are available to us.
View Pierre-Luc Dusseault Profile
NDP (QC)
Thank you, Mr. Chair.
My thanks to the witnesses for joining us.
My questions will go to Mr. Gallivan first.
To put things into context, let me point out that the minister told us, on a number of occasions and in various ways, that KPMG was going to be brought to justice. I would therefore like to know now how many criminal prosecutions have been filed against KPMG or against one of its clients who participated in the Isle of Man scheme.
How many prosecutions have been launched?
Ted Gallivan
View Ted Gallivan Profile
Ted Gallivan
2017-11-23 17:04
As you know, a criminal investigation can last a long time. It takes a number of years for this type of case to move up the ladder. As the minister and I have confirmed, we will keep pushing this file as much as we can, but our work is far from being over.
Results: 1 - 15 of 223 | Page: 1 of 15

1
2
3
4
5
6
7
8
9
10
>
>|
Export As: XML CSV RSS

For more data options, please see Open Data