I am always bemused by governments that will not estimate what I call their tax cap, the difference between the taxes they should raise and the taxes they actually raise, based upon their domestic legislation.
We have that problem in the U.K., where the estimates of our governments that are available online and the difference is a factor of about three. They say it's $32 billion and I say it's $90 billion. We have that issue now in Europe, and I provided the European Union estimate.
Now let's be clear. These are estimates. Nobody can claim they're right. But if you have an enormous problem, you're not going to tackle it unless you have some idea of the scale and therefore the resources that you need to direct at it. I believe there is a collective mindset amongst tax authorities to deny the scale of the problem because they see it as some implicit criticism of their behaviour. It isn't. There is an issue out there that they need to accept and address, and they need to demand from you the resources to tackle it. I think that's the number one point.
What can you do to tackle tax evasion? Most importantly, you can demand automatic information exchange from tax havens to Canada. You can follow the precedence of the U.S.A. with its new FATCA—Foreign Accounts Tax Compliance Act—legislation and say that basically as a condition of your being able to bank in Canada, we will demand that if you operate branches in other places, you must supply us with information on the Canadian resident people who have accounts in tax havens, and we need that information.
This is a valuable precedent. It's going to have an enormous impact in Europe, and we're already seeing that because you can break some of the barriers to progress here. It's already being used by the U.K. to demand information from its tax havens, which previously it's been denied. So I think you need to look at that as the major way of going forward.
In addition, you need to set precedents and make sure that you have your own house in order with regard to making sure that beneficial ownership and accounting data is properly recorded in Canada on public record, so that when you demand it from tax havens, they can't turn around and ask, “Why are you asking for information from us that you don't actually have available in your own domestic authorities?”