Evidence of meeting #23 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was cra.
A video is available from Parliament.
11:30 a.m.
Liberal
The Chair Liberal Wayne Easter
It's not a point of order, but could we stay on topic? I don't think we need any more bullying discussions around this place.
Mr. Caron, you have the floor. You're still quite okay for time.
11:30 a.m.
NDP
11:30 a.m.
NDP
Pierre-Luc Dusseault NDP Sherbrooke, QC
Thank you, Mr. Chair.
Madam Minister, thank you for being with us today.
The court documents show that the CRA clearly determined the scheme was illegal. Russell Lyon, an auditor from Victoria, British Columbia, clearly stated, in his affidavit, that the Isle of Man scheme was illegal.
Is it your view, as well, that KPMG was breaking the law from 1999 to 2003?
11:30 a.m.
Liberal
Diane Lebouthillier Liberal Gaspésie—Les-Îles-de-la-Madeleine, QC
I would ask Mr. Gallivan to answer this question. And I must point out that I was not in the House as a minister in 1999.
11:30 a.m.
NDP
Pierre-Luc Dusseault NDP Sherbrooke, QC
But you are the current minister, so you have the knowledge.
11:30 a.m.
Liberal
Diane Lebouthillier Liberal Gaspésie—Les-Îles-de-la-Madeleine, QC
This government has made historic investments. Our election platform made reference to such investments.
11:30 a.m.
NDP
Pierre-Luc Dusseault NDP Sherbrooke, QC
My question was simple, Madam Minister. I was asking you whether—
11:30 a.m.
Liberal
Diane Lebouthillier Liberal Gaspésie—Les-Îles-de-la-Madeleine, QC
We have stated that the fight against tax evasion and aggressive tax avoidance are priorities of this government.
11:30 a.m.
NDP
11:30 a.m.
NDP
Pierre-Luc Dusseault NDP Sherbrooke, QC
I was asking you whether your opinion, and that of the agency, is that the scheme was illegal.
11:30 a.m.
Liberal
The Chair Liberal Wayne Easter
Mr. Dusseault, we'll get the answers a lot faster if there are not interruptions.
The minister has the floor.
11:30 a.m.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
Mr. Chair, you are well aware that we have only five minutes to ask questions. The time belongs to the member. That is the acknowledged rule. We are trying to conduct this cordially, but we are also trying to avoid repetitive responses in the short time made available to us. We listen to the answers, but if we find they're a repetition of what was already said, we would like to go further in the questions asked.
11:30 a.m.
Liberal
The Chair Liberal Wayne Easter
As I understand it, Mr. Caron, the witness has the equivalent amount of time that the individual used for the questions. I haven't been timing it that closely, but that's my understanding, and that's what I'm going to stick with.
Mr. Dusseault, do you want to go to your question?
11:30 a.m.
NDP
Pierre-Luc Dusseault NDP Sherbrooke, QC
Thank you, Mr. Chair
In view of the time remaining, Minister, I hope you'll answer my questions directly. It will avoid several problems.
It's clear. Even if you don't say so personally, what was done from 1999 to 2003 was illegal. What will you be doing to bring KPMG to justice? I mean, quite apart from the fact that the clients need to be brought to justice too, it's the firm that developed this scheme. Will you be bringing KPMG to justice, given that it was the facilitator, that it put the scheme in place, and that it offered it to its clients for $100,000? Will you be launching a criminal investigation, so you can obtain a search warrant, get to the bottom of the matter, and ensure KPMG will be punished?
11:35 a.m.
Liberal
Diane Lebouthillier Liberal Gaspésie—Les-Îles-de-la-Madeleine, QC
Mr. Chair, as I mentioned from the outset, the Canada Revenue Agency is the one who detected the scheme put in place by KPMG.
I will ask Mr. Gallivan to answer my colleague, provide additional technical information, and complete the response.
11:35 a.m.
Assistant Commissioner, International, Large Business and Investigating Branch, Canada Revenue Agency
This is an ongoing matter. We have made known our intent to commence proceedings based on the facts available. The agency has demonstrated, through the investments committed in this budget, that it has made those who promote tax schemes a priority. Furthermore, such promoters have been a priority in our criminal investigation programs for several years. As the minister noted, this is a priority for us. We intend to continue this work, with the facts available to us.
11:35 a.m.
Liberal
The Chair Liberal Wayne Easter
Mr. Caron, you asked me for a 15-second notice. I'm giving it to you.
11:35 a.m.
NDP
Guy Caron NDP Rimouski-Neigette—Témiscouata—Les Basques, QC
I would like to table a motion that can be discussed at the end of the hour devoted to the question. The motion reads as follows:
That, considering the information heard so far regarding the tax avoidance scheme involving the Isle of Man and the amnesty agreement offered to certain past or current clients of KPMG LLP, the Standing Committee on Finance extends its ongoing study by a minimum of three (3) more meetings to hear additional witnesses; That the list of witnesses include, without being limited to, the following witnesses: KPMG and CRA employees: Denis Lacroix, Partner, KPMG LLP Michael Hamersley, Former Lawyer, KPMG LLP Barrie Philip, Retired Partner, KPMG LLP Jeff Sadrian, Senior Advisor, KPMG LLP Paul Hickey, Partner, National Tax, KPMG LLP Russell Lyon, Auditor, Canada Revenue Agency Independent experts: André Lareau, Professor, Université Laval Alain Deneault, Professor, Université de Montréal Arthur Cockfield, Professor, Queen's University Dennis Howlett, Executive Director, Canadians for Tax Fairness That the Committee hold a supplementary meeting for consideration of a report.
11:35 a.m.
Liberal
The Chair Liberal Wayne Easter
We will check to see if the motion is in order, Mr. Caron, and hand it to members and then deal with it.
Turning to the next question, we have Mr. MacKinnon.