LETTER:Liberals going easy on carousel tax scammers

Dear Minister Bibeau,

Following your non-answer to my question in Question Period on Deloitte’s interference in a Canada Revenue Agency (CRA) audit, I thought it best to write to you directly to raise this very important issue. As the NDP critic for Tax Fairness, I’m becoming increasingly concerned about how your department and more broadly the Liberal government takes the issue of billionaire tax avoidance.

Let’s look at the facts. The richest 123 corporations in the country avoid paying over $30 billion in taxes. The effective tax rate is the lowest it has ever been. Canadian assets in the top 16 tax haven jurisdictions conservatively surpass $400 billion, with more than 30 per cent of that number accrued in the 8 years since the Liberals took power.

This failure has a real and human cost. The infrastructure gap for First Nations is $350 billion. We have a record number of people lining up to food banks. Working people and people on fixed incomes are struggling while your government caters to the rich and powerful. Let me be clear, Canadians expect you to use the tools at your disposal to make sure the wealthy pay their fair share.

Which is why the reports coming out of CBC’s Fifth Estate series on carousel tax schemes is so concerning. Not only has the CRA handed out over a $1.1 billion in, as the CRA describes it, “illegitimate” tax refunds, but we know of at least one case where a phone call from Deloitte led to an audit being shut down within 24 hours and $63 million worth of, once again, "illegitimate" tax refunds to Iris Technology. The influence involved and timing surrounding this request is both deeply concerning.

The speed at which CRA moved in this case is particularly galling given the experience most Canadians have with them. For example, when a regular Canadian has a highly complex tax objection case, it can take over 690 days for CRA to sort out the pending issues. Unfortunately, not every Canadian has access to Deloitte.

So, I’ll ask you again, how many times has Deloitte reached out to senior CRA officials to shut down audits? Which other rich and powerful people have this kind of access? How much of public money is being paid out in “illegitimate” tax refunds?

In your answer to my question in Parliament, you said how all decisions made by the CRA follow the rules set out for them. If CRA rules allow for powerful firms like Deloitte to shut down audits, it’s clear the rules need to change. Canadians expect answers and I look forward to hearing from you soon.

Sincerely,

MP Niki Ashton (Churchill—Keewatinook Aski) – NDP Critic for Tax Fairness