Hon. Wayne Easter - 16:17
CPC (AB)
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Do you think it's fair for a Canadian without an offshore tax avoidance plan or offshore accounts to automatically lose a deduction if they can't produce documents within 90 days, whereas a Canadian with an offshore account is given months or years to comply with a request for information?
This is right from the Auditor General. I'm not making this up. It was three years ago that this report came out. I want to know if that's still the practice. Based on your last answer, I would really like you to comment and tell us whether you think that's fair.
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Hon. Diane Lebouthillier - 16:18
Ted Gallivan - 16:19
Hon. Wayne Easter - 16:19
CPC (AB)
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The Auditor General observed that this was actually unfair, that Canadians who didn't have offshore accounts were automatically denied a claim or deduction if they couldn't produce documents in 90 days.
What I would like to know is whether there has been any progress on providing more fairness to Canadian taxpayers who will automatically lose their deduction in 90 days, compared with offshore filers who can defy with impunity a request for documents from the CRA.
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Hon. Wayne Easter - 16:20
Hon. Wayne Easter - 16:20
CPC (AB)
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Mr. Gallivan has been here before. We haven't had the minister here in a while. The minister can answer the question, please.
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Hon. Diane Lebouthillier - 16:20
Hon. Wayne Easter - 16:35
Hon. Wayne Easter - 16:36
Hon. Wayne Easter - 16:42
CPC (BC)
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Thank you.
Madam Minister, at committee we've spent almost 30 hours wading through a ton of incredibly complex tax changes while studying the BIA. Everyone agrees that the tax act is overly complex. As a matter of fact, it's so complex that even your own team at the call centres gave Canadian taxpayers false or erroneous information 30% of the time, so even your own people don't understand it.
Small businesses are spending an exorbitant amount of money and time trying to comply. Under your watch, it has become even more difficult and leaves small business owners in constant fear of accidentally being non-compliant.
Would you commit today to Canadians to simplify the system so that they can stop wasting their precious time trying to wade through piles of incomprehensible tax rules?
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Hon. Diane Lebouthillier - 16:44
CPC (BC)
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I'll pass it on to my colleague. I find that an absolutely unacceptable answer.
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CPC (MB)
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Thank you.
Thank you, Madam Minister, for coming to the committee today. It's good to see you here.
I'll get right into it. Can you tell this committee how many dollars are lost each year to overseas tax evasion?
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Hon. Diane Lebouthillier - 16:44
Ted Gallivan - 16:45
CPC (MB)
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Okay. The Parliamentary Budget Officer estimates that annually we lose $25 billion in uncollected taxes due to overseas tax evasion.
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Ted Gallivan - 16:45
CPC (MB)
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Okay.
It says overseas. You should know better than I do.
Regardless, budget 2021 proposes to provide additional funding to the CRA to improve its ability to collect outstanding taxes, yet the budget document admits the investment will only lead to the collection of about $5 billion over the course of five years. That's a mere $1 billion per year compared with an annual $25 billion lost.
Minister, to me, recouping $1 billion for $25 billion lost is a failing grade. Your government is raising taxes on Canadians while failing to go after the taxes that are already owed. Why is that?
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Hon. Diane Lebouthillier - 16:46
CPC (MB)
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That comment just isn't accurate, Minister. In fact, CRA has launched fewer and fewer audits of large corporations over the last several years. It's actually a 30% drop during your tenure as minister, and of some 30,000 audits of large companies conducted since 2015, less than 20 of them were sent to the CRA's criminal investigation division. Half of those investigations have been abandoned, and a mere one case as been referred to prosecutors.
Is that really the best that this government can do?
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Hon. Wayne Easter - 16:48
Hon. Diane Lebouthillier - 16:48
CPC (MB)
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Mr. Chair, I actually have a couple more questions.
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Hon. Wayne Easter - 16:49
Hon. Wayne Easter - 17:02
CPC (ON)
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Thank you, Mr. Chair.
I would like to continue asking the minister questions.
In October 2016, Canadian taxpayers had to report the sale of their principal residence for the first time. Since then, taxpayers have had to designate their principal residence in their tax returns. Why? What is the purpose of these reports?
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Hon. Diane Lebouthillier - 17:03
Ted Gallivan - 17:03
CPC (ON)
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With respect, I'd like this next question answered by the minister, if I could, as her ministry is largely an administrative ministry.
Could that information collected in the principal residence exemption be used to impose a future tax on home equity? Is that possible?
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Hon. Wayne Easter - 17:04
CPC (ON)
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Yes, no problem. Thanks, Wayne. I'm sorry that I wasn't clear.
Currently, you have to declare the sale of a principal residence. Could the information collected by CRA be used in the future to help collect a home equity tax?
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Hon. Diane Lebouthillier - 17:04
Ted Gallivan - 17:05
CPC (ON)
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As William Shakespeare once wrote, me doth think you protest too much. It reminds me, with all respect, Mr. Gallivan, of my seven-year-old, when he's caught doing something and he feels guilty and immediately says, “I didn't do anything. I never did anything”. However, I do appreciate your service and respect you for that.
Getting back to the tax evasion issue, there are literally billions of dollars we're not getting from tax evaders. It's not just that I am saying that, or Mr. Julian is or Mr. Ste-Marie is. That's just fact. However, the government spent its first couple of years trying to collect from main street, from small business owners, an amount that was much lower.
Could you confirm for me, first, the amount of money we're losing because of tax evaders, and then, second, the money we got by harassing innocent hard-working small business owners from Canada's main streets?
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Ted Gallivan - 17:06
Hon. Wayne Easter - 17:09
CPC (BC)
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Yes, I want to ask the minister about a couple of programs that are tools in her tool kit for tracking down those who are evading and avoiding taxes.
There's the offshore tax informant program. Minister, are you familiar with that program?
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Hon. Diane Lebouthillier - 17:09
Hon. Diane Lebouthillier - 17:09
CPC (BC)
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Go ahead quickly, Mr. Gallivan.
How successful has that been?
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Ted Gallivan - 17:10
CPC (BC)
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What about the mandatory reporting of international EFTs?
That's for Mr. Gallivan.
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Ted Gallivan - 17:10
CPC (BC)
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Mr. Chair, my purpose for raising those programs—and there are others—is that both of those programs were implemented by Stephen Harper.
Minister, I just want to say to you that you came to our meeting and started off by attacking Conservatives. Then you told Mr. Ste-Marie to go fly a kite and go talk to the RCMP.
Minister, when are you going to take personal responsibility for the file that you've had since 2015?
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Hon. Diane Lebouthillier - 17:11
Hon. Wayne Easter - 17:24
Hon. Wayne Easter - 17:24