Tax havens are contributing to the growing inequality and is hurting our economy. In 2016 alone, wealthy Canadians sent over 272 billion dollars to offshore tax havens.
In the last few months, we have worked with many experts and citizen groups to find concrete solutions for this injustice.
Here are three actions the government can take to put an end to this serious issue.
Renegotiate the tax treaties and tax information sharing agreements Canada has signed with tax havens.
Since the 1980s, the wealthiest members of our society have developed several schemes with tax havens in order to avoid paying their taxes. Today, the government loses out on close to 8 billion dollars a year in revenue because of these scams. These losses are costing us dearly.
Despite the global outrage against tax havens, neoliberal policies have amplified the problem. In 2015, Canadians hid away close to 187 billion dollars in West Indian tax havens -- that’s 34 billion dollars more than the year before. And this number continues to grow thanks to the tax treaties developed by the Conservatives and signed by the Liberals with known tax havens. In fact, the most recent one was signed with the Cook Islands by Justin Trudeau.
The wealthy are capable of hiding their fortune away in tax havens because we allow them to! By signing tax treaties, they’ve made legal what was once illegal. New Democrats refuse to stand idly by in the face of this injustice.
That’s why we’re calling on the Canadian government to renegotiate these tax treaties and tax information sharing agreements with tax havens. All it would take is a simple amendment to the Income Tax Act to keep society’s wealthiest from skipping out on their tax bill.
If you agree, make your voice heard by sharing this video and signing the petition.
Put an end to penalty-free amnesty agreements for individuals guilty of tax evasion.
Do you feel like there are two sets of rules in Canada: one for the wealthy and one for regular folks? In fact, when it comes to the Canada Revenue Agency, you’d be right on the mark…
The federal government loses out on close to 8 billion dollars a year in revenue because of the money stashed away in offshore tax havens by the wealthy and large multinationals. However, when they get caught with their hand in the cookie jar, they can take advantage of amnesty agreements offered by the Canada Revenue Agency with its Voluntary Disclosures Program, which allows them to reimburse what they owe — without penalty or interest!
For example, when KPMG’s rich clients got caught hiding away more than 130 million dollars in the Isle of Man, a renowned tax haven, thanks to an elaborate scheme put into place by the accounting firm, they were offered penalty-free amnesty agreements. With the Voluntary Disclosures Program, these multimillionaires received no penalties, nor were they accused of their crimes.
Unlike these rich fraudsters, the average taxpayer doesn’t have access to these special privileges. If you produce your income tax return late, regardless of the reason, you’ll have to pay penalties and interest fees! The Canada Revenue Agency is sending a clear message to the people: if you’re wealthy, you’ll get a second chance. But if you’re not, get ready to pay up.
Does all of this seem fair to you?
These special privileges need to end. These fraudsters need to be paying penalties when they get caught. Even the United States imposes penalties of up to 30% when the wealthy stash away their money in tax havens!
If you agree, let your voice be heard by sharing the video and signing the petition.
Prevent multinational corporations from using false expenses to take advantage of tax deductions
Did you know that multinationals pay very little tax, and that citizens are practically the only ones who bear the cost of our infrastructures and public programs?
Over the years, multinationals have developed various schemes to reduce their tax burden. For example, between 1988 and 2014, investments in Barbados by wealthy Canadians and Canadian multinationals increased from $0.6 billion to $71.2 billion. Barbados is now Canada’s third largest financial partner. That’s rather odd, given that the country has a population of only 300,000.
How is it that Canadian multinationals are investing more money in Barbados than in China? It’s simple: Canada has a very good tax treaty with Barbados. The tax rate for a Canadian multinational investing in Barbados is only 2%. All it has to do is create a false expense to justify its investment. For example, this could be the right to use the patent for one of its pharmaceutical drugs, which belongs to its subsidiary in Barbados.
When tax time comes, the corporation has nothing to report to the tax office because all its income has been invested in Barbados. This sleight of hand keeps getting better; the corporation does not have to pay any taxes when it brings its money back into Canada, because it already “paid” taxes in Barbados!
Does that seem fair to you?
Multinationals should pay their fair share. That is why the NDP has introduced a bill to prevent them from using false expenses to take advantage of tax deductions. If Bill C-362 is passed by the House of Commons, multinationals will have to prove that their expenses are real in order to claim a tax deduction.
If you agree, make your voice heard by sharing the link and signing the petition.
In order to get there, we need to make our voices heard. Sign our petition and send a clear message to the government.