Usa Forum - Could we have used $108 Billion in our tax coffers?

and a woman shall lead the way

6/17/2016 9:01:00 PM

If this doesn't make your blood boil, then perhaps you have no reason to gripe about such things as pending carbon taxes or the new tax being planned by the BC 'Liberals' to replace their defeated HST.

*These* are monies that could have been working for Canadians and Canada - in everything from healthcare to infrastructure to paying down our debt. But no, Harper and his web of corporate-hugging schemers decided to make life even more comfortable for the rich. And here's how they did it . . . . (remembering that Harper was elected to his first majority government in 2011).

See the chart and see when the tax-dodging began in earnest. . . .
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https://www.thestar.com/news/world/2016/06/17/offshore-tax-avoidance-fixing-it-made-it-...

Tax loopholes cost Canada billions in lost revenue

Netherlands Antilles State Secretary of Finance Alex Rosaria, left, and Canadian Minister of Finance Jim Flaherty sign a tax information exchange agreement (TIEA) in Vancouver, B.C., in 2009. Deals like it were meant to crackdown on tax haven secrecy but in fact helped lead to greater tax evasion

https://www.thestar.com/content/dam/thestar/news/world/2016/06/17/offshore-tax-avoidance-fixing-it-made-it-worse/7233864.jpg.size.custom.crop.108...

Under the guise of combating tax evasion, the federal government opened up
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dozens of tax loopholes that have allowed Canadian corporations to avoid paying tax on $55 billion in international profits over the last five years.

The money is funneled into offshore tax havens and can be brought back to Canada tax free by multinationals based in Toronto, Vancouver and Calgary.

These offshore manoeuvres translate into billions of dollars in lost tax revenue for Canada, not because companies are cheating, but because they are encouraged to avoid taxes by government policies. ^^^^^^^^^^^^^^^^^^^^^
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Since getting elected, the Liberal government has promised to fight tax evasion and tax avoidance, spending millions to reinforce the investigative branch of the Canada Revenue Service.

A joint investigation carried out by the Star and the CBC, however, shows that the previous Conservative government helped corporations avoid paying their fair share by turning a crackdown into a loophole, and the new government has done nothing to staunch the bleeding. ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
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In 2010, Canada joined an initiative launched by the Organization of Economic Co-operation and Development to make tax havens more transparent and started signing Tax Information Exchange Agreements (TIEAs) with notorious tax havens like the Cayman Islands, Jersey, the Isle of Man and the British Virgin Islands.

At the same time, the tax code was altered to allow any Canadian multinational corporation doing business in a TIEA partner country to bring profits home tax free.

American multinationals have to pay tax when they repatriate international profits. But, in Canada, the TIEAs mean that profits can be declared in a tax haven, where there is little or no tax, and brought back without paying a penny more.
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“TIEAs are a well-meaning but failed idea,” said Arthur Cockfield, a professor of tax law at Queen’s University who warned the government of the TIEAs potential for abuse.

“I don’t blame the companies. It’s kind of like a Christmas present sitting under the tree. What are you going to do, not open it?”

While Canada’s tax treaties have for decades encouraged businesses to work out of Barbados, where the tax rate is between 1 and 2.5 per cent, the TIEAs have opened up a new chapter of legal tax avoidance in zero-tax countries like Bermuda, the Bahamas and Panama.

Many of the leading corporations on the Toronto Stock Exchange now have a presence in tax havens and use Canada’s treaties to dramatically reduce their tax bill at home. One company, Gildan, reduced its taxes by more than 90 per cent in 2015 (see sidebar).

TIEAs have had a dramatic effect on offshore investment, and Canadian money stashed in tax havens is piling up rapidly. Canadian companies have increased their stockpiles of cash by more than 50 per cent in the Cayman Islands and the Bahamas since 2011, when their TIEAs came into force.

They’ve doubled in Bermuda over the same time period, according to Statistics Canada data. In Panama, accumulated Canadian funds have increased by more than 600 per cent since its TIEA became law in 2013.

In the graph, you can see how Canadian money held in tax havens has shot up since the first TIEA came into force, more than doubling in the last five years to reach $108.2 billion in 2015.
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[snip]
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Some great graphs, showing just where our corporations hid their money.

https://www.thestar.com/news/world/2016/06/17/offshore-tax-avoidance-fixing-it-made-it-...

ab.politics

Could we have used $108 Billion in our tax coffers?

and a woman shall lead the way

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