Evidence of meeting #84 for Finance in the 42nd Parliament, 1st Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was businesses.
A video is available from Parliament.
Conservative
Blake Richards Conservative Banff—Airdrie, AB
Mr. Chair, something that the minister just said is untrue. Our government initiated the review—
Liberal
The Chair Liberal Wayne Easter
Mr. Blake, I'm going to allow Mr. Gallivan to respond.
Ms. O'Connell.
Liberal
Jennifer O'Connell Liberal Pickering—Uxbridge, ON
Mr. Chair, while I welcome Mr. Richards on this committee and all committees, the rule is that you ask your question and the witness has an equal amount of time to respond. You may not like what you are hearing, but those are the rules and I would ask that we all be held to those rules.
Conservative
Blake Richards Conservative Banff—Airdrie, AB
I have a point of order, Mr. Chair. Could I respond to the point of order?
Liberal
Assistant Commissioner, International, Large Business and Investigations Branch, Canada Revenue Agency
Thank you, Mr. Chair.
From an official's level, I can tell you that in a previous position I had responsibility for domestic compliance. There was no national campaign focused on that sector of the Canadian economy, campgrounds. Based on the feedback CRA officials did, I can tell you that not just in the audit area but also in our legislative policy area, CRA reviewed the legislation to confirm the understanding and interpretation of the legislation as drafted. From our perspective, there has been no change in this area either from the interpretive perspective or from an enforcement perspective.
Conservative
Blake Richards Conservative Banff—Airdrie, AB
Mr. Chair, you indicated that you would give me just a brief amount of time.
Liberal
Conservative
Blake Richards Conservative Banff—Airdrie, AB
The only thing I wanted to add was simply that the claim is being made that nothing has been changed. In fact, under interpretation bulletin IT73R6, the small business deduction, there was a change to the way this was applied.
I can provide this to the minister in both official languages if she would like so she can check it out for herself.
Liberal
The Chair Liberal Wayne Easter
Okay, you can leave a copy of that with the committee for sure.
Mr. Gallivan, Minister, do you have anything further to add on that point?
Mr. Dusseault.
NDP
Pierre-Luc Dusseault NDP Sherbrooke, QC
Thank you, Mr. Chair.
I am going to try to change the tone with my first question. I did not have the chance to ask you this last year.
Why have some headings in the departmental plan been written in red since you have been Minister of National Revenue? Up to 2015-16, they were in blue. All of a sudden, they changed to red in the 2016-17 departmental plan.
Liberal
Diane Lebouthillier Liberal Gaspésie—Les-Îles-de-la-Madeleine, QC
The job that was entrusted to me in my mandate letter is about services to Canadians, about improving services, and about the fight against tax evasion and aggressive tax avoidance. I have to tell you, Mr. Dusseault, that I have never given a second thought to the colour of the text in the report.
Liberal
Diane Lebouthillier Liberal Gaspésie—Les-Îles-de-la-Madeleine, QC
But thank you for pointing it out.
NDP
Pierre-Luc Dusseault NDP Sherbrooke, QC
No problem.
I have a more serious question.
The committee produced a report with 14 recommendations. A number of them came with timelines. In your response to the report, you committed to a lot.
The first recommendation I would like to deal with is recommendation 3, which deals with negotiated settlements. You said that you were going to review the way in which you handle negotiated settlements.
That clearly is a result of the KPMG affair, when KPMG clients were able to negotiate settlements. In fact, it seems that we have to call it a “negotiated settlement” rather than an “amnesty”.
On the subject of negotiated settlements, your commitment was “for the CRA to be transparent about the process of negotiated… settlements”. Consequently, “the CRA will review its guidelines by March 31, 2017”.
Today is May 3, 2017. Can you update us on the new guidelines for negotiated settlements?
Liberal
Diane Lebouthillier Liberal Gaspésie—Les-Îles-de-la-Madeleine, QC
Thank you for your question, Mr. Dusseault.
I would like to thank the committee for the report it produced. My department has accepted all 14 recommendations in your report.
As for the voluntary disclosures program, I would like to remind you that, last year, I commissioned an evaluation by an independent person, Kimberley Brooks. She evaluated the whole process to determine whether everything was in order. In this aspect, indeed, it was.
I can tell you that we are in the process of responding to the 14 recommendations. Mr. Gallivan will be able to tell you what point we have reached.
NDP
Pierre-Luc Dusseault NDP Sherbrooke, QC
My specific interest is in recommendation 3, dealing with negotiated settlements, not with all the recommendations.
Assistant Commissioner, International, Large Business and Investigations Branch, Canada Revenue Agency
The review we committed to is complete. The review was limited to the agency only. We also consulted our advisory committee.
The revised national procedure is scheduled for October 31 this year. I should say that one of the major changes is to be very strict about a decision-making committee. It will not just be made up of senior officials from the agency; it will also have representatives from the Department of Justice on it.
In the past, there were some criteria for consultations. Holding consultations was left to people's discretion a little.
In the future, all the files will be sent to an advisory committee made up of senior officials from the agency and from the Department of Justice. That will make sure that there is some consistency in the decisions, and that they will be looked at from all angles.
NDP
Pierre-Luc Dusseault NDP Sherbrooke, QC
Thank you for that answer. We will keep our eye on it.
In the second last paragraph of page 35 of the English version of your departmental plan, it says that you are going to publicize the consequences of engaging in tax avoidance and tax evasion schemes.
There are advertisements on your website and on your social media showing people in handcuffs. Despite the ads, which I encourage, we have not really seen anyone convicted and going to jail in recent years.
Can you at least assure Canadians today that there will be more frequent prosecutions and there really will be people in handcuffs, like the ones in your photos? Your photos are misleading. It has not happened in recent years. Can you commit to putting people in jail for real, not just in your Facebook photos?
Liberal
Diane Lebouthillier Liberal Gaspésie—Les-Îles-de-la-Madeleine, QC
I thank my colleague for his question.
That actually gives the government the opportunity to talk about all the work it has done and will do to combat tax evasion and aggressive tax avoidance.
As I mentioned in my remarks, our activities are currently geared towards criminal activity. Investigations are under way and are taking their course.
As for tax evasion and tax avoidance, Mr. Gallivan has a lot more technical information. We know that Canadians want to know what is happening, they want everyone to pay their fair share and, if something is considered criminal, they want it to be dealt with as such.