Hundreds of retired fishermen are celebrating a win against the Canada Revenue Agency after learning they will received refunds of taxes wrongfully paid. — Telegram file photo
Eli Baker was channelling Danny Williams when he reacted to the news that more than 700 retired fishermen from this province have won their battle against the tax man.
“We got it!” he said, echoing the former premier’s words in 2005 when he announced the Atlantic Accord had been successfully renegotiated.
Williams uttered that phrase again in June this year, when St. John’s was approved as the newest member of the American Hockey League.
Baker, a St. John’s-based lawyer, represents the group of 752 fishermen in a legal case, in which they fought the federal government to get back taxes owed for licence buybacks in 1999 after the cod moratorium.
On Monday, he received word that the Canada Revenue Agency (CRA) has confirmed that the redetermination of Victor White’s case — a test case on behalf of the 752 — has been approved and refunds will be issued to each of them.
“The phone has been ringing off the hook all day here,” Baker said.
“This is huge news for everybody.”
It’s an issue that began in tax year 2000, when buyout recipients from the previous year were advised by the Department of Fisheries and Oceans (DFO) they had to pay capital gains taxes on the money they received for their licences.
It was later determined they had been given the wrong advice.
Fishermen in other years, before and after 1999, did not pay the same high tax rates and received significantly more money as a result.
A small group of fishermen challenged the federal government on the issue and settled out of court for an undisclosed amount.
The bulk of the fishermen did not.
Baker, who took on the case of those remaining fishermen in 2006, fought the matter in court.
In May of this year, a Newfoundland Supreme Court judge ruled to allow the group the right to seek a reassessment of the taxes they paid on the buyouts of their fishing licences.
Now that CRA has approved the refunds, Baker said the agency plans to set up a special team in this province to deal with the huge volume of refunds to be issued.
“To have this many reassessments done all at once, this has never happened before,” Baker said.
“We’re all figuring out the best way to do it.”
Baker isn’t sure of the amount of the refunds, but to help his clients, he’s engaged the services of Fitzpatrick and Company Chartered Accountants, based in Prince Edward Island, to review each of the 752 tax returns.
“Obviously, we’re not just going to accept whatever refund they say, ” he said.
“It was a ripoff when it started and it’s not going to be a ripoff when it ends.
“When (my clients) see cheques in their hands, they’re not going to know they were ripped off again. We’ll be making sure that those cheques will be accurate. There’s no wondering now. They are going to get back what they should get back.”
Baker expects the CRA will begin issuing refunds in mid-October. Given the possibility of negotiations on both sides, he said his clients can expect to have their money by Christmas.
“I’m overjoyed for all my clients and their families.”
It’s been a long road for many of them, he said.
“Almost all of them are living below the poverty line,” Baker said.
He said many are senior citizens who have had to move to Alberta to make ends meet, while others are in poor health and some — 10 per cent — are deceased. Baker represents 76 estates.
“This means so much to them. I was speaking to a wonderful window whose husband died and she couldn’t afford fresh milk to go in her tea. Guess what? She can now,” Baker said.
“And there’s a man from the west coast who sleeps in a snowsuit because he can’t afford to heat his house. He can now.
“Speaking to them today, I could hear the smiles in their voices. Everybody is just so happy.”
Elizabeth Harvey is one of those.
“I’m on top of the world,” she told The Telegram Monday. “It’s a happy day.”
The 53-year-old from Isles aux Morts was instrumental in bringing the issue to the forefront.
In 1999, her husband, Douglas Harvey, sold his fishing licence for $110,000. He paid close to $24,000 in taxes on that buyout.
But she held meetings at her home for fishermen considering taking part in the court case. Over the years, she would phone call-in shows and give updates to radio, television and print news reporters on the progress of the case in order to keep it in the spotlight.
“This means the world to us,” she said.
“It shows that you don’t step back and let someone push you around. What happened to us was unfair and now justice has been done.”
Harvey said the hard work was worth it, but has only one regret.
“I only wish the fishermen who passed on were here to enjoy this,” she said.
“I would love to have them to enjoy this with us, but I know they’re looking down and smiling.”