Tax Cheats Exposed

Tax Cheats Exposed – Will The Release Of The Panama Papers Change Anything?

Presenter: John Pope

May, 2016

Many wealthy Canadians and Canadian based companies have been taking advantage of tax havens to avoid paying their share of taxes in this country.  While most people are aware that tax havens exist, no one has been able to identify those who were cheating the tax man – until now.

A tax haven is a jurisdiction where particular taxes, such as an inheritance tax or income tax, are levied at a low rate or not at all.  Tax havens can be set up by law firms and other financial institutions in complete secrecy.

The secret database from just one of these tax havens has recently been released by a whistleblower.  The ICIJ has now made public a trove of more than 11.5 million leaked files from the Panama-based law firm Mossack Fonseca, one of the world’s top creators of hard-to-trace companies, trusts and foundations. 

The Canadian members of the journalistic consortium estimate there are some 625 Canadians named in the documents:  To see what they have found go here:  http://www.huffingtonpost.ca/2016/05/09/panama-papers-canadian-names_n_9869810.html

The CRA is investigating, and it is estimated that it could take up to two years to sort it all out and identify what is owed in back taxes.  Will this involve a ‘deal’ where companies and wealthy Canadians can get off with little or no penalty?  This is already happening, e.g. the firm KPMG:  Response to Tax Dodging by Rich Will Show Trudeau’s True Colours  http://thetyee.ca/Opinion/2016/05/13/Rich-Tax-Dodging/

Federal budget earmarks $90 million annually to tackle evasion. It’s about time:  http://thetyee.ca/Opinion/2016/03/24/Canada-Fights-Tax-Dodgers/

Here’s Canada’s response to the Panama papers release: http://business.financialpost.com/news/economy/canada-to-push-for-global-tax-fraud-crackdown-after-second-release-of-panama-papers-data

Some reports say that these hidden offshore accounts are created for reasons other than to cheat the tax man, but they don’t give any examples.  Most economists say there is no useful purpose for them:  https://www.thestar.com/news/world/2016/05/09/tax-havens-serve-no-useful-purpose-say-more-than-350-leading-economists.html

The Canadian members of the journalistic consortium estimate there are some 625 Canadians named in the documents:  To see what they have found go here:  http://www.huffingtonpost.ca/2016/05/09/panama-papers-canadian-names_n_9869810.html

The ICIJ database contains information on almost 320,000 offshore entities, including some Canadian entities, that are part of the Panama Papers and the Offshore Leaks investigations. The data covers nearly 40 years up to the end of 2015 and links to people and companies in more than 200 countries and territories.

To search the icij database on their web site go here: https://offshoreleaks.icij.org/ 
(I don’t recommend searching the web site because it is difficult to navigate and doesn’t give the best results)

To conduct an unimpeded search on your own PC, download the archived database (https://offshoreleaks.icij.org/pages/database) in spreadsheet form for easy searching and navigating.  Many of the data are simply numbered companies, but many names and addresses appear also.

Yes, Canadian names appear including from here in Victoria (FYI: Peter J. Parkinson, 209 Taurus Dr., Victoria was found after a very brief search of the archives.  I also recognized names from my old home town of London, Ontario.)



Questions:

Why haven’t Canadian authorities investigated tax avoidance scams before this massive leak happened?

Will this leak lead to changes in the loophole that allows tax havens?

Will the CRA demand payment from people and companies for back taxes?

Will anybody go to jail for tax evasion in Canada?  Why not?

How much tax revenue could be collected in Canada if all the tax havens were exposed?

Will the local media investigate these listed local names and companies? 

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