Is a Canada Revenue Agency landlord avoiding taxes via offsh

[Oscar]

Is a Canada Revenue Agency landlord avoiding taxes via offshore havens?

[ http://www.nationalobserver.com/2015/10 ... ore-havens ]

By Bruce Livesey in News | October 15th 2015

The Canada Revenue Agency (CRA) rents office space from a Vancouver-based property developer – a company that exploits offshore tax havens in Liechtenstein, the British Virgin Islands and Channel Islands.

Larco Investments Ltd. owns three buildings in Montreal, Calgary and Edmonton where they rent office space to the CRA. Larco purchased the buildings from the federal government in 2007.

Yet evidence has emerged that Larco takes advantage of offshore tax havens.

“It's interesting to us that as a government landlord, that’s also the landlord of the CRA, when the CRA is supposed to be going after this (offshore) stuff… it just raises questions about whether the CRA is aware,” says Michelle Travis, research co-ordinator of UNITE HERE Canada, a retail sector union which represents workers employed by Larco.

UNITE HERE stumbled upon Larco’s use of offshore tax havens while researching the company.

The Larco-CRA case is symbolic of the Harper government’s track record of allowing billions of dollars of potentially taxable corporate monies to flee to offshore tax havens. In 1990, only $11-billion was flowing from Canadian corporations to offshore tax havens: today this sum is almost $200-billion a year and growing. An estimated $8-billion is also lost annually through tax evasion.

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While other countries crack down on tax avoidance, Harper lays off thousands of CRA staff

If the Laljis are using offshore havens to chop their tax bill, they have plenty of company among Canada’s wealthiest families and the corporate sector.

In fact, the tax haven of Barbados is the second-largest recipient of Canadian foreign investment after the US – with $71-billion in 2014, up from $50-billion in 2010, while the Cayman Islands are ranked fourth, receiving $36-billion. “When Canadian corporations invest $71 billion in the Barbados we know it’s not about investment – it's about tax avoidance,” says Deneault.

Of course, using offshore havens for evading taxes is a time-honoured tradition among Canada’s political and business elites. Former prime minister Brian Mulroney received cash payments from German arms wheeler-dealer Karlheinz Schreiber totaling $300,000—though Mulroney claimed it was $225,000— in 1993 and 1994, which he didn’t bother declaring to the CRA until 1999. For a period of time much of this money sat in a safety deposit box in a New York bank.

Canada Steamship Lines Inc. (CSL), the family business of former prime minister Paul Martin Jr., has an international division registered in the Barbados. The Barbadian corporation is owned by a holding company in Bermuda, another offshore haven. This complicated setup allows CSL to escape paying millions in Canadian taxes.

Meanwhile, prominent business families such as the Irvings, Bronfmans and Stronachs use offshore havens to cut their tax bill, as do the chartered banks and corporations like Cameco, Gildan Activewear, Eldorado Gold, Cirque du Soleil and Québecor, among many others.

KPMG and banks like RBC have been investigated by the CRA for helping wealthy Canadians set up offshore tax structures.

And how has the Harper government responded? In 2012-13, the government chopped $259-million from the CRA’s budget over five years – the largest single cut to any department, making it harder to investigate tax evasion.“They laid off three thousand CRA staff, totally decimating capacity and losing many experienced auditors,” says Howlett. “What's happening now is while other countries are beginning to crack down, Canada is lagging behind.”

Meanwhile, the number of people convicted of tax evasion in Canada has dropped by more than half since 2009, according to the CRA’s own figures. In 2013, it was discovered that Jim Love, chairman of the Royal Canadian Mint, and a good friend of former finance minister Jim Flaherty’s, helped a wealthy Canadian family move millions through offshore havens to avoid paying taxes.

However, the CRA disputes there has been any reduction in "its efforts on international non-compliance," it said in a statement, or has cut the number of auditors it employs. The CRA says that $234-million, in fact, has been allocated over the next five years to expand its capacity in this realm, and they've added $7.8-billion to the revenue base over the past couple of years due to their work.

Nevertheless, Senator Downe is appalled at how little political will there is to collect monies owed to the government.

“There is a lot of money out there,” he says, “a lot of money is owed and a lot of money is not being collected…. Why are you and I paying taxes when other people are avoiding them? We should not have to make up the shortfall.”

[Oscar]

Canada Revenue Agency’s landlord stashed money in offshore tax havens

[ https://www.thestar.com/news/world/2016 ... avens.html ]

Three CRA offices were sold off to a family with extensive offshore holdings in the British Virgin Islands and Liechtenstein

By Marco Chown Oved Foreign Affairs Reporter December 13, 2016

The federal government agency tasked with cracking down on offshore tax avoidance rents its offices from a corporate group that has moved hundreds of millions of dollars into tax havens.

Three Canada Revenue Agency offices — in Calgary, Edmonton and Montreal — were sold in 2007 in a controversial sale and leaseback arrangement to Larco Investments Inc., a company privately held by Vancouver’s reclusive Lalji family.

Larco was desribed as a “100 per cent Canadian company” when the sales were announced, but records found in the Panama Papers leak and at the Nevada State Gaming Control Board show the three Lalji brothers, who are worth an estimated $3 billion, routed profits from their business interests through the British Virgin Islands (B.V.I.) before parking them in private foundations in Liechtenstein.

In a legal operation to reduce their tax bill, the brothers moved somewhere between $300 million and $500 million offshore before 2003. It is not possible to determine if the Lalji’s Canadian profits — some come from rent paid by the taxpayer — still flow offshore, although the most recent public filings indicate that their U.K. profits still route to the B.V.I.

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[ https://www.thestar.com/news/world/2016 ... avens.html ]