In fact, I am not totally committed to a study that would be limited to what the Canada Revenue Agency can do about that. I am trying to say that the Canada Revenue Agency is one of the vectors that we can use to fight tax havens. So the point is not to discredit the agency but to explain that if we send it alone to the front, sooner or later we are bound to see small improvements on the fringe of the issue.
There is the globalization architecture, the result of decisions taken most often by western governments since the 1980s, and which explain the global geopolitical situation. If there is a place where we should be able to ask questions on that global architecture, surely it is in this Parliament.
To be as concrete as possible, I would say there are two broad categories of problems. The first concerns capital transfers to tax havens done by individuals. Most often this is done illegally. An individual, as opposed to a multinational, knows that when he is in Ottawa, he cannot be in Belize, Panama, Luxemburg or Hong Kong at the same time. However, a business can manage funds and do intra-corporate transfers if it is dispersed into several entities. The issue of tax evasion is closely linked to the very structure of multinationals that escape public monitoring because of their multinational nature. States are played one against the other, but operations are coordinated from locations that are not subject to government monitoring, that is to say tax havens, with legislation of convenience.
So how does an individual profit from this extraterritorial global structure? Secrecy is at the heart of the issue, in that people defraud the tax authorities, they omit disclosing a certain number of things, and secrecy guarantees that the Canada Revenue Agency will not be informed of the presence of assets that have been hidden abroad. This is where automatic information exchange policies are necessary. The tax information sharing agreements that have been signed and are in effect currently make it possible to break the seal of banking secrecy around the time when we already have the information we want to obtain. In any case, when we are that advanced in a file, all we need to do is collect a few elements. It is a major issue that requires a diplomatic approach.
I would like to point out that even if we obtain automatic information sharing, there are certain area such as in Hong Kong or the British Virgin Islands where the legislation does not even require that they keep records. We may get bank confidentiality lifted, but it can happen that the documents we find contain not a trace of the names of the interest owners. This legislation does not even oblige a business lawyer or an asset offshoring expert to keep these records. Consequently, even if we manage to lift banking secrecy, there will always be this problem, which one day or another will be political. One of these days a global, political, and diplomatic solution must be found to deal with these issues, since legislation is at the core.
As for the large businesses, please allow me to say just one word. The Canadian government has greatly encouraged the tax evasion practices.