Finance Committee on Oct. 29th, 2025

[Trevor McGowan]

I can say, certainly, that, on the tax policy recent developments side, we have a number of information-sharing and information-reporting rules that come with serious penalties. While tax evasion is illegal and a criminal offence and has its own penal consequences, there are a number of recent changes that we talked about.

We have the common reporting standard, which can help provide information on money and bank accounts internationally; the crypto-asset reporting framework proposals being developed at the OECD, and draft legislation, I think, was released on those; and enhanced reporting on cross-border transactions, in the T1135 form, on electronic payments of more than $10,000. We have a lot of significant reporting requirements that have been introduced, each of them with serious penalties for failure.

[Mario Simard, Bloc, Jonquière, QC]

Quickly, do you know how many people are convicted of tax evasion annually? Do you have comparable data for other countries?

[Eric Ferron]

I don't have that information on hand, but I can tell you that, in the past five years, so from 2020 to 2025, more than 100 individuals have been convicted of tax evasion—106 to be precise. They—

[The Chair, Liberal, Karina Gould]

Thank you, Mr. Ferron. That's all the time the member has.

Thank you, Mr. Simard.

We have eight minutes left. Are the committee members okay with splitting the time in half, so four minutes for the Conservatives and four minutes for the Liberals?

[Some hon. members]

Agreed.

[The Chair, Liberal, Karina Gould]

Great.

Over to you, Mr. Lefebvre.

[Éric Lefebvre, Conservative, Richmond—Arthabaska, QC]

Mr. Lemieux, since the beginning of your presentation, you've said that the CRA has been making constant improvements. It's no secret that some rather damaging articles about you have come out in the news lately. How do you go about identifying problems in your organization? What method do you use?

[Marc Lemieux]

We use audit results to measure the impact of new measures and new audit teams. For example, how much of what was owed by taxpayers was the CRA able to identify?

When we do our audits, we add the amounts we've identified and we ask people to pay the additional amount.

[Éric Lefebvre, Conservative, Richmond—Arthabaska, QC]

That's a quantitative assessment—based on the numbers—but qualitatively speaking, does the CRA have a way to assess the service it provides to Canadians?

[Marc Lemieux]

The CRA uses a number of service standards to measure service quality, and they are publicly available. We report annually to Parliament on those service standards.

[Éric Lefebvre, Conservative, Richmond—Arthabaska, QC]

If I asked you to name two of the CRA's weaknesses, what would they be?

[Marc Lemieux]

I think I would let people make that determination based on the results we release. As the past little while has shown—and we've said this—we need to work on service delivery. We've developed a plan to address the service issues we identified.

[Éric Lefebvre, Conservative, Richmond—Arthabaska, QC]

If you have a plan, you should know exactly where the weaknesses in your approach are.

[Marc Lemieux]

Right now, the CRA is doing a lot of work to address the problem with the information provided to callers. My colleagues have spoken at length about that to parliamentary committees in the past few days. We have a 100‑day plan, and we are looking not only to increase our call capacity, but also to identify what we can do to give people online self-service options. We are examining our operations to see where we can provide faster service, so that people don't have to call the CRA.

[Éric Lefebvre, Conservative, Richmond—Arthabaska, QC]

In terms of new technology, you talked about AI. That is one possible solution, as long as the answers and information provided are right. That's important. Ms. MacLean talked about it, saying that real experts are needed, at least in some specific cases.

Do you think more money is the key to the CRA's ability to do better? When I look at the past nine years, what I see is a 70% increase in the CRA's budget, yet the agency still has challenges, to put it mildly. Again, the Liberals have announced more funding for the CRA so that it can deliver better results. Personally, what I think is needed is an assessment of the organization's operations, to see where the strengths and weaknesses lie. You need to work with a dashboard, and then we can look at investments. Would you agree?

[Marc Lemieux]

I think our commissioner made the point that it's about more than just having additional resources. It's also about finding the best technologies and reviewing our practices to provide Canadians with the best possible service.

[Éric Lefebvre, Conservative, Richmond—Arthabaska, QC]

You're saying that more money isn't necessarily the way to fix things.

[The Chair, Liberal, Karina Gould]

Thank you, Mr. Lefebvre and Mr. Lemieux.

The last turn goes to Mr. Lavoie.

[Steeve Lavoie, Liberal, Beauport—Limoilou, QC]

Thank you, Madam Chair.

Mr. McGowan, I'd like to discuss businesses with you. Those who know me know that I care a lot about businesses. I spent a lot of years working in banks, helping businesses obtain financing. I went on to represent them in chambers of commerce. How does the department measure the impact of international tax evasion on the competitiveness of Canadian businesses that adhere to their tax obligations in Canada?

[Trevor McGowan]

Hopefully, this will balance out an earlier question that I wasn't able to finish as well.

There's a constant balancing act between competitiveness—we want our businesses and our multinationals to succeed when they're competing in foreign markets—and a desire to not facilitate inappropriate tax avoidance and erode the Canadian tax base.

We've seen several measures over the last few years—they're very technical, so I won't get into them—trying to respond to planning that had arisen and that had inappropriately eroded the Canadian tax base.

We have, at the Department of Finance, in the tax policy branch, a team of economists. We work very closely with our economists and lawyers to help ensure that in markets in which Canadian multinationals compete, they compete on a level playing field, so the best business ideas can win.

We consult regularly with businesses. For each of our tax measures, we consult somewhat continuously throughout the year, gathering feedback, making refinements to our proposals and trying to ensure they meet their objectives as efficiently and effectively as they can.

[Steeve Lavoie, Liberal, Beauport—Limoilou, QC]

I'm going to ask you something you weren't expecting. Say I had a trophy to give you. As far as tax measure improvements go, what would you say is your proudest achievement in the last five years? What are you proud of? Surely, there's something. I can see you smiling. Where did you make progress, and what are you proud of?

[Trevor McGowan]

It's difficult on a personal level to keep track of time, but over the last five years the pandemic response required a very significant involvement from my branch.

[Steeve Lavoie, Liberal, Beauport—Limoilou, QC]

Yes.

[Trevor McGowan]

Over a very short period of time, maybe 72 hours, the wage subsidy was developed from idea to final product, which helped deliver, very rapidly, much-needed help to Canadians at a difficult time. That jumps to mind.

[Steeve Lavoie, Liberal, Beauport—Limoilou, QC]

Thank you.

I know you've already talked about this, but what is the potential economic impact of all the tax compliance measures you've put in place at the international level?