International Crackdown on Taxes Continues
Well it would seem that the Canada Government is ready to get back at in the New Year with their continuation of the international and aggressive tax avoidance measures.
It is interesting that the CRA has made such big pushes to go electronic and is encouraging more electronic activities. They also don’t seem to be stopping there. Now they are zeroing in on electronic funds transfers. Banks and some other financial institutions are now going to have to report to the CRA incoming and outgoing international orientated electronic funds transfers if they are $10,000. or over.
According to government officials this is going to make it easier to identify several things. It will allow them to isolate more effectively high risk taxpayers. Plus be able to get a better handle on those who practice international tax avoidance. The hope is to better target those who try to hide money and assets in offshore banks and other means.
At the same time the government is patting itself on the back for making progress with their tax avoidance endeavors. They are saying that there has been a significant increase in taxpayers becoming involved in the voluntary disclosure program, and specifically related to offshore dealing. It is said that this has helped the CRA identify a large amount of unreported income to the tune of $300. million.
They have released further stats showing that since April 2006 they have convicted 62 taxpayers for tax evasion. This involved $20 M of federal taxes and about $12M in court fines, and added to this was 701 days jail time.
While these figures may sound impressive we are talking a time period of 8 years. Sixty two convictions over eight years with a population as big as Canada, and we are led to believe that we are plagued with tax avoidance? It is not clear if these figures depict all tax arrears collected throughout that time, or just those that were considered to be high risk tax avoidance issues.
It seems that there are never ending stories from average tax payers that have run into some back tax problems, and that the CRA has been relentless in their undertakings to collect.
The bottom line is that tax avoidance overall hurts the entire country and indirectly right down to the average tax payer. Rather than having hassles with the CRA and having a tax debt looming over you, just meeting your tax obligations is the best move you can make.