Getting serious about tax havens

Lana
Lana Payne
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“You know, there’s two schools in economics on this. One is that there are some good taxes and the other is that no taxes are good taxes. I’m in the latter category. I don’t believe that any taxes are good taxes.”

— Stephen Harper, July 10, 2009

This week Prime Minister Stephen Harper will join other G8 leaders in Northern Ireland.

They will talk taxes, more specifically tax havens and tax evasion. Some G8 leaders, including the U.K.’s David Cameron, are pushing for much tougher global tax compliance. Mr. Harper, not surprisingly, is offsides.

He made the above comment (in an interview with The Globe and Mail) four years ago while attending another G8 meeting in Italy.

It was a shocking statement from a head of government. After all, taxes are the means by which we build society — hospitals, roads, schools, bridges, wharfs. They are how we make sure our food is safe. They are used to enforce safe workplaces, to administer public programs, to ensure our water is safe for our children to drink. Taxes are, as Oliver Wendell Holmes once said, the price we pay for civilization.

Of course they are also the grandest form of working together as a collective, a proposition Canada’s prime minister appears to abhor.

Given Mr. Harper’s opinion on taxes, it should come as no surprise that he is said to be the problem at the G8 table. Tax havens, of course, are a practice by which the very rich get to hide their money so they can avoid paying taxes.

After all, if, as the prime minister believes, all taxes are bad, why then the need to seriously crack down on those who avoid them?

According to Canadians for Tax Fairness, Canada has been withholding support for two key aspects of the G8 tax havens action plan. They include that financial institutions in tax havens be required to have a public registry of the

ultimate beneficial owner of all accounts, trusts or corporations and that there be multilateral tax information sharing between governments.

The tax fairness folks say these measures are important to “lifting the veil of secrecy that allows wealthy individuals and corporate tax evaders and criminal organizations to hide their wealth offshore.”

But Stephen Harper, it appears, would rather protect the cheats. Yes, well, don’t be surprised; there was that Mike Duffy affair.

So let’s get this straight.

The government — bent on forcing unions to publish nearly every transaction on a public website, taking up the time and resources of Revenue Canada officials, creating a pile of red tape for labour organizations, violating privacy laws and in all likelihood the Constitution — is opposed to a public registry to catch tax evaders.

Go figure.

Experts (all but one hired by the anti-union organization pushing the bill: Merit Contractors) testified at hearings that they believed the bill to be unconstitutional and a violation of privacy laws. (This is known as Bill C-377 and it is currently at the Senate Committee stage: a fine crowd to be preaching to unions about accountability and transparency! But I digress, as this bill has nothing to do with accountability and transparency, and everything to do with Mr. Harper’s long game of silencing dissent and punishing those who disagree with him.)

Tax havens and tax avoidance is a very big problem for governments and citizens around the world with between $20 trillion and $32 trillion socked away in offshore tax havens, according to tax justice officials.

In Canada, both the federal and provincial governments are losing billions in taxes every year as a result — money that could go towards skills upgrading, healthcare or public infrastructure.

Indeed, reports indicate as much as $170 billion in Canadian money is stowed away in these tax havens and that federal and provincial

governments in Canada are losing a whopping $7.8 billion annually because of tax evaders stuffing their money away in offshore havens.

According to a submission to the House of Commons Finance Committee by Canadians for Tax Fairness, banks and the financial industry are one of the biggest users of tax havens.

But instead of making a real and serious effort to catch and punish those who break the law, such as tax cheats, the Conservative government would rather use government resources to punish unions, environmental groups and charities who play an advocacy role in our society.

According to a CBC investigation into Canadians using tax havens, the government has convicted just 44 people between 2006 and 2012 of criminal tax evasion related to

offshore assets. Despite these guilty convictions, the government refused to release further information, citing privacy concerns.

Just incredible.

Protect the tax cheats and tax evaders even when they have been convicted of breaking the law.

Political pundits are now saying this prime minister has lost his way.  They are finally catching up to the majority of Canadians who have always felt this way.

Lana Payne is president of the Newfoundland and Labrador Federation of Labour.

She can be reached by email at lanapaynenl@gmail.com.

Twitter: @lanampayne

Her column returns June 29.

Organizations: Globe and Mail, Revenue Canada, Senate Committee House of Commons Finance Committee CBC Newfoundland and Labrador Federation of Labour

Geographic location: Canada, Northern Ireland.They, U.K. Italy.It

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Recent comments

  • Ed Power
    June 17, 2013 - 11:54

    It would appear that our Wild Rose thrives in a manure filled environment....

  • Purple Library Guy
    June 15, 2013 - 21:19

    Maybe if we convinced them that, as per the slogan about guns, if they make hiding money illegal only criminals will have money. Criminals having all the money seems to be the Conservative endgame anyway, so maybe they'd come around.

  • erika
    June 15, 2013 - 10:49

    taxes are the price we pay for living in a healthy, well-educated society with clean water, paved roads and safe food. it's quite possible even stephen harper managed to benefit from some of these things--you know, being born in a hospital, walking down sidewalks, going to public school and attending university.

  • Tim
    June 15, 2013 - 10:41

    To anyone who thinks that all taxes are bad, I offer a challenge: For one day, avoid everything taxes have paid for. Don't drive on a road, don't visit a hospital, don't send your kids to school, don't use electricity or running water, and let me know how your day went. Then imagine going your entire life missing out on all of these things and far more. Holmes was right, taxes suck but they make the societies we take for granted possible, and we all need to work together for a common good that we all have an interest in.

  • WIld Rose
    June 15, 2013 - 07:16

    Harper is right all taxes are theft.