Recent measures the Canada Revenue Agency (CRA) has taken to help in the federal government’s fight against tax evasion will result in a more equitable tax regime for all Canadians, and in more revenue generated for Ottawa to help in funding federal programs, the CRA said Thursday.
The CRA said that early results of audits conducted in the most recent fiscal year suggest the federal government is on track to capture more than $13 billion worth of taxes owing. The CRA also estimated that the $1 billion in additional funding that the agency has received in the last two federal budgets would have a “revenue impact” to Ottawa of more than $5 billion over the next five years.
“Canadians work hard to pay their fair share of taxes, so that they can enjoy the social programs we all benefit from and which make a big difference in our lives,” said the Honourable Diane Lebouthillier, Minister of National Revenue, in a release updating Canadians on the CRA’s progress in combatting tax evasion and aggressive tax avoidance. “When some choose not to pay their part, it places an unfair burden on all of us.”
“We are building a stronger and more fair tax system, where those who choose to cheat are no longer able to hide and will face the consequence of their actions,” she added.
The CRA provided an update to the federal government earlier this week on measures it has taken so far to address recommendations made by the Standing Committee on Finance in the fall of 2016 on fighting tax avoidance and evasions. These recent measures include:
> Establishing specialized collection teams and adding technical and legal expertise to the CRA’s audit and investigative teams;
> Improving processes to better leverage external data for the identification of high-risk taxpayers;
> Increasing collaboration with domestic partners, such as the Public Prosecution Service of Canada (PPSC), to more effectively crack down on those who participate in tax crimes;
> Increasing collaboration and information sharing with international partners to combat tax evasion and aggressive tax avoidance across borders;
> Striving for early resolution of audit issues in a fair and consistent manner;
> Reviewing and modernizing existing programs, such as the voluntary disclosures program, through consultation with experts and Canadians.
In recent years, the federal government has made combatting tax evasion a priority, committing additional resources to the CRA to help in meeting that goal. In the 2017 budget, the government gave the agency an additional $523.9 million over five years to help prevent tax evasion and improve tax compliance. In the 2016 budget, the government provided the CRA with $444 million to “detect, audit and combat tax evasion and avoidance.”
The CRA said that two-thirds of the more than $13 billion it says it is on track to capture from its audit efforts for the fiscal year ending March 31, are the result of audits efforts relating to large businesses and multinational companies.
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