Mr. Speaker, I would like to thank the senator who introduced this bill. Much of the work has therefore already been done in the other place.
I would also like to thank my colleague who is sponsoring Bill S-217, of course. This is a bill about accountability and transparency. The Bloc Québécois will be supporting it, so there is no suspense there.
Essentially, the bill seeks to have the Canada Revenue Agency disclose all convictions for offshore tax evasion and to have the agency release an annual report presenting statistics on the tax gap, which represents the taxes that should have been collected but were not and that Canadians and Quebeckers ultimately make up for through their own taxes. After all, there are some people who do pay their taxes.
The government member told us that Canada was part of a select group of countries that published this information. He told us that the Canada Revenue Agency had done so twice, successfully, and congratulated the government. My Liberal colleague is not wrong, because the federal government made that commitment in April 2016. It committed to estimating the tax gap, including data on fraud, bankruptcies and honest mistakes. However, the most recent data are from 2022. It is now 2026, almost 2027, and there has not been any update. It is true that the Canada Revenue Agency released a report in 2026, but the data covered only the period from 2016 to 2022.
The government supports the principle of the bill. However, it also serves as a reminder that binding legislation is needed for the Canada Revenue Agency to carry out this work. As taxpayers and parliamentarians, we have a right to know the size of the tax gap.
Earlier, my colleague told us that the tax gap will never be reduced to zero. There is nothing in the bill that calls for the tax gap to be eliminated. The bill does, however, require that the tax gap be measured and publicly reported so that it can be quantified. Moreover, this is only a first step, since the bill deals solely with offshore tax evasion. For example, a Canadian taxpayer may hold assets or real estate abroad, decide to sell those assets and fail to report the resulting capital gains in Canada. It is possible to develop estimates of those amounts. As taxpayers, we are entitled to that information.
I understand that this may seem like an original idea, but there are many other countries that do this. I think it is a transparency measure. I would like to point out that two other bills contained essentially the same measures, but they were defeated in the House: Bill S‑258, in the 44th Parliament, and Bill S‑243, in the 42nd Parliament.
What is interesting about Bill S‑243 is that the Liberals voted against it. The Liberals had a majority. Mr. Trudeau's government came in with all the best intentions in the world, which it kept up for one, two or three years and, ultimately, those intentions did not translate into results. When we demanded results, they voted against the bill that called on them to honour their own commitments. That is why we need legislation.
I said that this was not a partisan issue. The Parliamentary Budget Officer has come out in favour of the principle of the bill and the bill itself. It is also the role of the Parliamentary Budget Officer to prepare revenue projections for the government. What we heard from the Parliamentary Budget Officer is that a greater ability to access data on the tax gap would help her in her work. The last I heard, the Parliamentary Budget Officer is not the Bloc Québécois, it is not the Conservative Party and it is not the New Democratic Party.
In my opinion, there is a consensus in Quebec society, in Canadian society, among experts, those who do research and analyze the performance of our tax agencies, and among parliamentarians. I am certain that there are members on the other side of the House who would like to see improvements at the CRA.
The first person who should want that is the Minister of Finance and National Revenue, who is also responsible for the Canada Revenue Agency. If the goal is to improve, that needs to be quantified and done right.
Again, it is important to put a name to things. Back when the Liberal government rejected a similar bill, it told us that it was because the bill would violate the right to privacy, personal information and so on. Many cases of fraud and wrongdoing are made public when there are convictions. When it comes to tax evasion—not tax avoidance, which is legal even if it is not desirable—someone who is caught abroad creates a tax gap. I do not see the issue with making that information public.
This also brings us to the broader issue of the Canadian government's ability or lack thereof to collect tax revenues from taxpayers. As I said at the outset, a taxpayer who does not pay their fair share of taxes is a taxpayer who puts the burden of paying down the debt, servicing the debt, and paying for the armed forces, the public service and family benefits on the shoulders of another taxpayer. Those who do not pay their taxes are people who think that another taxpayer is going to pay them. At some point, some of our most vulnerable citizens might be in a position where they do not receive certain services because the Canadian government does not have the full fiscal capacity to pay for them. My Liberal colleague said earlier in his speech that this gap could be as much as 10% of federal government revenues. Do they realize what 10% means? Even if the government does not bring it down to zero, it is huge.
The bill addresses international tax evasion. However, it is important to document where the tax gap comes from. Are there bankruptcies involved? Are there people who are unable to pay their taxes, as we saw during the pandemic? How much of the gap is due to those situations? If the goal is to take action in the right place, it is important to know that information and put a name to those things. More broadly, the government will also have to take the issue of tax avoidance more seriously. For a number of years, certain corporations and the wealthiest individuals, those who should be contributing more, have been resorting to increasingly aggressive tax avoidance strategies. That is perfectly legal because, in many ways, Canada's tax laws are like sieves. As is known and documented, the Canada Revenue Agency has one of the lowest tax recovery rates among all the tax agencies in developed countries.
I remember that soon after the government came to power there was the KPMG scandal. KPMG is one of the companies known as “the big four”. One of those four firms went under. The big four are large firms with very large clients. They advised these clients on schemes to pay less tax, such as through transfer pricing, the shifting of intellectual property abroad and other similar mechanisms. So aggressive were these schemes that criminal charges were laid in the United States against KPMG for promoting them to clients. At the time, we asked the then minister of national revenue Ms. Lebouthillier why she was not using her authority to investigate what had happened at KPMG in Canada. While federal criminal charges had been brought in the United States, here the minister told us that her government could not do anything because the agency was at arm's length and that she was there merely to sit in the minister's chair. She made sure it stayed warm and did nothing else, even though the law allowed the minister to launch an investigation. While the law did not empower the minister to meddle in individual taxpayers' files, it did empower her to launch an investigation. What happened next? A backroom deal was made with KPMG. No charges were ever laid. We do not know what kind of accountability resulted from the agreement. We do not know what impact it had on the tax gap, namely the revenues that the government failed to collect. It has damaged Canada's reputation as a supposedly advanced tax jurisdiction. Perhaps had this law been passed, we would now have a clearer picture of what occurred in the KPMG case in Canada. I will conclude on this point: Because of the delay in disclosure, the report that would have resulted from the application of this legislation would have shed light on what happened in the KPMG scandal in Canada. We know what happened in the U.S.
It seems obvious to me that if the government wants to keep its word and its promise, it will have to vote in favour of this bill with the Bloc Québécois.
