Mr. Speaker, I am thankful to be able to stand and speak on behalf the hon. member for Calgary Rocky Ridge. He is a dear friend, and I believe that this is a very important piece of legislation that he is bringing forward here in the House. It is an honour to speak on it.
I would also like to thank Senator Percy Downe for introducing this bill in the Senate. It is a shame that the government plans to oppose it, but I hope government members will listen to all of the reasons that this bill makes sense for the government and for Canadians.
It is timely to be speaking about Bill S-243 now, as the majority of Canadians just finished filing their taxes with the Canada Revenue Agency. We also just found out that the Canada Revenue Agency wrote off $133 million owed by a single taxpayer.
CRA employees discussed the large writeoff in an internal memo in September of 2018, and the media reported on this memo in April. However, we do not know who the taxpayer is or whether it is a person or a corporation. We also do not know whether this writeoff is related to government subsidies, which is something Canadians should know.
The aim of this bill is to keep the CRA accountable for tax collection efforts. It would also require the CRA to report on the tax gap, which is the difference between taxes owing and taxes actually collected. The bill would also require the CRA to publish information on convictions for domestic and offshore tax evasion. Data shows that the offshore tax gap for the 2014 tax year was between $0.8 billion and $3 billion.
The CRA has published information about the tax gap related to the goods and services tax. In 2014, here the offshore tax gap was estimated to be about $4.9 billion. The CRA has also shared the domestic personal income tax gap for that same year, 2014, at $8.7 billion. In that one year, the money owed for the tax gap, which could have been as high as $16 billion, could have funded many programs or eased the tax burden for many Canadians.
Conservatives believe in making life more affordable for Canadians and in keeping taxes as low as possible to stimulate the economy. When the government loses a significant amount of money because of a tax gap, it means that taxes could be raised for the rest of us. This penalizes law-abiding Canadians.
I support Senator Downe's bill, which is sponsored by the member for Calgary Rocky Ridge here in the House, because it makes sense and makes the CRA and those Canadians not living up to their responsibility to pay taxes more accountable.
Some Canadians are concerned that reporting on the tax gap could threaten their privacy, but this bill balances the privacy of individuals with transparency and accountability for the CRA. The information would be reported to the Parliamentary Budget Officer, so its intent is not to name and shame average Canadians.
The United States, the United Kingdom, Sweden and Australia all report on their tax gaps. These governments all indicate that they report this information because it helps their revenue departments understand how and why non-compliance occurs. This information is helpful to policy-makers, who can then make better-informed decisions about tax policy and also help the government better manage its resource allocation.
Canada should have this system. Mandating measurement of the tax gap ensures that future governments and parliaments have all of the information necessary to take action on the tax gap.
Many of us are aware that offshore tax evasion is a problem in Canada. Almost 1,000 Canadian taxpayers, including individuals, corporations and trusts, were named in the Panama papers three years ago.
The CRA told media last month that it had identified 894 taxpayers and had finished reviewing 525 of these cases, resulting in $14.9 million in federal taxes and penalties. This number will rise as audits continue.
Although the CRA told the media the amount of taxes assessed, it did not say how much of that money has actually been collected. Senator Downe's bill, if passed, would require the CRA to report that type of information to Canadians. As I mentioned before, this type of information would be incredibly helpful to our policy-makers. Many other countries use this information, and Canadians would be better served if our policy-makers also had this kind of information.
Most Canadians work hard all year and diligently file their taxes. These are honest people who would never attempt to cheat the government. However, we see wealthy Canadian individuals and corporations attempt to cheat the tax system all the time.
Tax money is used to fund services we enjoy, such as health care, transit and roads. The CRA should be able to say how much money it has collected as a result of the Panama papers. This is in the Canadian public interest.
Similarly, it should be allowed and able to tell us why $133 million was written off for a single taxpayer. That money could provide significant funding for public services, and Canadians deserve to know why this taxpayer or corporation received special treatment while the rest of us diligently work to pay our fair share.
I have had many constituents complain about dealings with the CRA, including poor levels of service or the agency repeatedly requesting documentation that has already been provided to a different branch. The Office of the Taxpayers' Ombudsman, which operates at arm's length from the CRA, has experienced an increase in complaints over the last few years. In 2017, the taxpayers' ombudsman said the biggest complaints were: first, the struggle to even get through to the CRA call centre, which can be a huge headache, especially around tax time. Other complaints included receiving inconsistent and incorrect information from the call centre agent and the lack of information sharing between different branches of the CRA. Many Canadians have been asked to produce the same information or documents more than once, because the person's file was not properly shared between departments.
The taxpayers' ombudsman called these problems “systemic” and said there are other deeply rooted problems. The CRA acknowledges that it needs to do more to better serve Canadians, and representatives from the agency will be travelling across Canada over the next month to conduct in-person consultations on how the CRA can improve its services. I have no doubt they will receive plenty of feedback. I am hopeful that the CRA will take this feedback and then implement it to create a better-run system, which Canadians deserve.
I know it is not just the CRA that has these problems. A recent Auditor General report found that other government departments, including immigration, employment insurance and the Canada pension plan, did not answer their phones for the millions of Canadians who called them in 2017 and 2018. It is obvious the government needs to make huge improvements to give Canadians the accessible service they require and deserve.
I hope these consultations by the CRA are fruitful and we will see a service improvement in the near future. I know how seriously Canadians take the CRA, except for wealthy Canadians who keep their money in offshore accounts without thinking of the consequences. For many Canadians, getting a letter from the CRA is anxiety-inducing, and dealing with audits and investigations can cause high levels of stress.
When Canadians owe the CRA money, most work to pay that money back, whether it is through installments or a lump sum payment. Most people would not dream of running out on the bill, so to speak, so they should not be unfairly penalized when corporations and wealthy Canadians run out on their tax obligations.
If this bill passes, it means increased accountability for the CRA, which is in the best interests of taxpayers. The changes proposed in this bill require the CRA to report on all convictions for tax evasion in addition to reporting the tax gap, as I mentioned earlier. This data would be reported to the Minister of National Revenue in the CRA's annual report, which is tabled in Parliament. The Minister of National Revenue is also required to provide the Parliamentary Budget Officer with data to calculate the tax gap.
These amendments, which would be inexpensive to implement, would increase transparency, which the government allegedly values. Publicly available reports on the gap between income taxes owed and taxes collected will provide a metric for judging the efficacy of measures to combat income tax evasion. This is important information for Canadians to have access to. Many other western nations publicly post this information. Canada is already behind standard practice in this regard. Conservatives support any measures to enhance the effectiveness and accountability of the public service.
Bill S-243 is a common-sense amendment to the Canada Revenue Agency Act, and I support the amendments.
I thank Senator Downe for his work on this bill, and the member for Calgary Rocky Ridge for helping to get the bill through the House of Commons. I appreciate the opportunity to speak to this bill today.