Mr. Chairman, I was invited to speak about KPMG, but I'll speak generally.
If an accounting firm or a tax firm creates a scheme whereby a sum of money is eventually owned by an offshore corporation, and this money initially comes from a donor in Canada and then the money comes back to Canada, that is not covered by GAAR.
This is not an amount that is subject to the general anti-avoidance rule. Why? Because there is no tax avoidance, but rather tax evasion. Don't try to see avoidance or an application of section 245 of the Income Tax Act here. It is not included in that respect.
What we are talking about is tax evasion. We are talking about a situation in which someone tries to cover money transfers by indicating that they are donations, when that is obviously not the case.
What is a donation? It is a divestiture of a sum without anything being expected in return. As soon as something is expected in return, as soon as the money comes back to the owner or the owner's immediate family or individuals dependent on the owner, it is an amount received and, therefore, not a donation.
For a tax strategy to be valid, it must respect the tenets of the act. In this case, of course, the tax strategy would not respect the letter or the spirit of the act.
Furthermore, I would invite the Minister of National Revenue to be very careful in all circumstances involving voluntary disclosure. Since voluntary disclosure is governed by purely administrative rules, I would invite the Minister of National Revenue not to exercise her discretion in the case of sums that come from abroad and that, obviously and in some circumstances, may be the product of fraud against the act. Therefore, administrative discretion should not be exercised in that regard.
Furthermore, in terms of files that may be outstanding with respect to amounts from the Isle of Man, I would also invite the Minister not to negotiate arrangements and not to conclude agreements so that the files can be submitted to the court and we can get to the bottom of this.
Lastly, I would say that the tax strategies highlighting donations do not stop at those we know about. Tax strategies highlighting donations can be carried out as part of Canadian corporate asset freezes, while the added value of these companies goes abroad in the form of donations to the benefit of donors. All the profit of a Canadian company eventually comes back as donations, which is demonstrated in the documentation that has been provided to you.
Thank you.