Government Operations Committee on May 11th, 2020

[The Chair, Conservative, Tom Lukiwski]

Mr. Kusmierczyk, you have about one minute left.

[Irek Kusmierczyk, Liberal, Windsor—Tecumseh, ON]

Thank you very much. I yield that time to my colleague.

[The Chair, Conservative, Tom Lukiwski]

Go ahead, please, Mr. Jowhari.

[Majid Jowhari, Liberal, Richmond Hill, ON]

Thank you, Mr. Chair, and thank you to my colleague for sharing his time with me.

Minister, in your speech that was handed to us, you talked about mobilization and reassignment of a lot of resources within CRA to be able to deliver the programs. With the limited time that is available, can you share some of the challenges, especially with training and technology and the extended hours? How did you manage that process? We had a lot of calls coming in to say the process was slow, but those calls have now almost disappeared. I'd like to know how you managed that process. Could you shed some light on that?

[The Chair, Conservative, Tom Lukiwski]

Unfortunately, Minister, we're completely out of time, so once again I would ask that you prepare an answer in writing to our clerk, who will then be able to distribute your answer to all committee members.

Now we'll go to a five-minute round once again, to Madame Vignola.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you very much, Mr. Chair. I would like to inform you that I will be sharing my time with Xavier Barsalou-Duval.

Good afternoon, Madam Lebouthillier. First and foremost, I would like to congratulate each and every member of your department for the immeasurable and extraordinary work they have been able to do so far. My questions are for clarification, not accusations. I like to understand things.

In your speech, you said that Canada Revenue Agency had realigned its activities. What exactly did you mean by that? What are those activities?

[Diane Lebouthillier, Liberal, Gaspésie—Les-Îles-de-la-Madeleine, QC]

You're absolutely right when you say that the agency employees did an incredible job.

In order to be able to deliver benefits to people, whether the Canada emergency response benefit or the Canada emergency wage subsidy, all employees had to focus on the emergency measures we had to implement for Canadians. In addition, we need to ensure the safety of our employees. So many of our employees are working from home. We had to organize telephone services at home, while at the same time maintaining data privacy for all Canadians. That's why we're saying that they did an incredible job.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you. In your speech, you also said that there has been a temporary suspension of the vast majority of audits.

What about the 50 investigations of companies using tax havens? Have these investigations also been suspended?

[Diane Lebouthillier, Liberal, Gaspésie—Les-Îles-de-la-Madeleine, QC]

I can tell you that these investigations are ongoing. When we talk about audits, we're talking about the regular work that is done on a daily basis. It's part of the agency's work.

With regard to the audits, if you want more technical details, one of the officials in charge could answer your question.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

I just wanted to know if the investigations had been stopped; thank you.

I'd like to continue on the topic of tax havens. I know it's a hot topic. People want to understand what's going on. You recently said that $1 billion was invested to counter these tax havens.

How much money has the government been able to recover through this investment? It invested $1 billion. How much money did you ultimately recover?

[Diane Lebouthillier, Liberal, Gaspésie—Les-Îles-de-la-Madeleine, QC]

Thank you. Initially, the money invested was also used for organization, to put in place and consolidate the tools our public servants use. This made it possible to hire auditors and rebuild an expertise that had been taken away from us by the previous government, for which this was not a priority.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

At the end of the day, how much did this $1 billion investment bring in?

[Diane Lebouthillier, Liberal, Gaspésie—Les-Îles-de-la-Madeleine, QC]

Investigations are ongoing and cases will be litigated. Requests have been made in this regard, as per regulations. Mr. Gallivan, who really is the expert on tax evasion, will be able to answer you very well.

[Ted Gallivan, Assistant Commissioner, Compliance Programs Branch, Canada Revenue Agency]

As the minister mentioned, we have a lot of cases, over 3,000, before the courts. A lot of these audits are going to end up in court. However, we have already recovered, in gross figures, $4.4 billion, and we are several years ahead of our projections.

[Julie Vignola, Bloc, Beauport—Limoilou, QC]

Thank you very much, Mr. Gallivan. I will now hand over to my colleague Mr. Xavier Barsalou-Duval.

[The Chair, Conservative, Tom Lukiwski]

Mr. Barsalou-Duval, you have only 30 seconds, sir.

[Xavier Barsalou-Duval, Bloc, Pierre-Boucher—Les Patriotes—Verchères, QC]

Thank you Mr. Chair.

I have a very brief question for you, Minister. I'm an accountant by training, and when I worked in accounting offices, we had organizational charts that explained the structure of a company and who owned it.

On their T2 return, on which they report their income, I'm sure that businesses indicate whether they own another corporation. So the Revenue Agency knows that one business owns another. From that, it is therefore quite possible for the Agency to know who uses tax havens and who does not, since it...

[The Chair, Conservative, Tom Lukiwski]

Monsieur Barsalou-Duval, we're completely out of time, sir.

Our next intervenor is Mr. Green. Go ahead, Mr. Green, for five minutes.

[Matthew Green, NDP, Hamilton Centre, ON]

Thank you very much, Mr. Chair.

With recent announcements, I think it's generally felt that by targeting only those convicted of tax evasion, the government is setting the bar far too low and is still letting public money go to companies that use offshore tax havens and funnel resources to tax-sheltered jurisdictions with public money.

To the hon. minister responsible for CRA, will companies under investigation with regard to the Panama Papers and the Paradise Papers still be eligible for the large business credit, yes or no?

[Diane Lebouthillier, Liberal, Gaspésie—Les-Îles-de-la-Madeleine, QC]

I would say that your question is too complex to be answered with a yes or no answer. What I can say, though, is that all the programs we put in place really serve to protect the workers and employees of companies, regardless of who their employer is. I can assure you that we continue to fight against companies that use these stratagems.

[Matthew Green, NDP, Hamilton Centre, ON]

I can certainly appreciate folks wanting to evade their taxes, but I want to make sure we don't evade the question.

How many companies and taxpayers disclosed in the Paradise Paper cases have been convicted of tax evasion?

[The Chair, Conservative, Tom Lukiwski]

Minister, you're on mute.

[Diane Lebouthillier, Liberal, Gaspésie—Les-Îles-de-la-Madeleine, QC]

I'm sorry, Mr. Chair.

As I was telling you, Mr. Green, this type of case is complex because people use very sophisticated schemes. We will continue to protect employees, no matter who they work for. My goal is really to make sure that Canadians have money to pay for their groceries and their housing. Companies that use schemes will be prosecuted and held accountable. That could go as far as jail time.

[Matthew Green, NDP, Hamilton Centre, ON]

I'm assuming that through the good work of the CRA and through your investigations, honourable minister, you ought to have a list.

Are you going to use the list of tax havens to draw up a list of companies that will not be eligible for credits to the large companies, and if so, what is this list and which tax havens are mentioned in it by country?

[Diane Lebouthillier, Liberal, Gaspésie—Les-Îles-de-la-Madeleine, QC]

Among other measures we've taken in recent years, we have been working with the OECD. We assess four countries a year and exchange information. Our goal remains the same: to have everyone pays their fair share.

The Agency is only responsible for administering the programs. With respect to the creation of the programs and their eligibility criteria, Minister Morneau will be in a much better position to answer you. We have listened to the concerns of our colleagues and Canadians and we will continue to work to find solutions.