Mr. Speaker, I am pleased to rise in the House to speak to Bill S-243. Although the bill was introduced here, in the House, it is actually a Senate initiative sponsored by Senator Percy Downe, for whom I have a great deal of respect. Back when I was the NDP finance critic, I had the pleasure of working with him on tax evasion issues. I know this issue is really important to him.
In the previous Parliament, the Standing Committee on Finance studied the tax gap, which is the difference between what the government does collect and what it should collect. That is money the government misses out on because of tax evasion, aggressive tax avoidance, the use of tax havens and so on.
I remember when the committee was debating it, we had witnesses from all over the world, including the United States, Great Britain and various European OECD countries, as well as Canadian experts. We heard from experts on taxation, banking and various organizations.
It became apparent that we needed to measure the tax gap. However, at the time, the Conservative government and the Conservative members of the committee had no interest in moving forward. They told us that it was impossible, that it would require too much work, and that any data we might gain from the whole exercise would not justify the resources required to see it through. I do not think that was true, and the Liberals who were on the committee at the time agreed.
However, as soon as they took office, the Liberals became reluctant to get the Canada Revenue Agency to be transparent and to start measuring the tax gap. Yes, they ended up doing it. Yes, the CRA is now doing some hasty calculations to try to tell us how much tax revenue is likely being lost.
However, most stakeholders do not believe the amount is accurate. As part of a review of all tax measures, the CRA claimed that the government is currently losing about $7 billion or $8 billion in tax revenue. Most tax fairness organizations do not believe that. The Conference Board of Canada even conducted a study on measuring the tax gap, which found that it may actually be closer to $45 billion or $47 billion, if we rely mainly on how much tax revenue is currently being lost by the United States, which I would remind members has a lot more resources to deal with this issue than the CRA does.
The Parliamentary Budget Officer now has the authorization, power and desire to measure the tax gap. For two years, the Parliamentary Budget Officer and his office were asking for authorization to proceed with an accurate measurement of the tax gap. For two years, the Liberal government refused to give them the information they needed. For two years, the Parliamentary Budget Officer did not have the information needed to proceed with this important study, a matter on which the CRA has no credibility, and yet, the government claimed the whole time to support the office.
Here is why I believe the CRA has no credibility. During the entire time that I had to deal with the agency, all I saw was a lack of transparency. Not only did I find that they were unwilling to provide information, but I also observed that they were withholding it.
Not that long ago, at the beginning of this Parliament, I sat on the Standing Committee on Finance. Among other things, we studied the whole scheme involving KPMG and the Isle of Man. After a handful of committee meetings, we were no longer allowed to examine the processes that KPMG had been involved in.
When CRA representatives testified before the committee, they gave every possible excuse for not providing the information. They told us that it would breach confidentiality, that privacy could be at risk and that it could not give us information that KPMG deemed to be privileged. There was every reason to deny us the information, but none of them were valid.
We could have done what the U.S. usually does, which, in the case of KPMG, was to use the committee's authority to issue subpoenas requesting that KPMG officials testify and compelling them to do so.
Both the Canada Revenue Agency and its minister had a hand in that.
The minister does not have much credibility. Throughout this Parliament, she repeatedly told us that the government and the Canada Revenue Agency had taken steps, but that turns out not to be the case.
For example, the minister repeatedly said that the government invested $1 billion to fight tax evasion and had recovered $25 billion, but that turned out not to be true. The government did not recover $25 billion; it hoped to recover $25 billion. As it turns out, “hope to recover” is exactly right because the government is far from hitting that target at the moment. Then the minister said the government really had taken the necessary measures and that CRA had hired 1,300 new auditors. Well, we did the math, and so did the media, and we figured out that CRA hired 192 new auditors, not 1,300.
The Canada Revenue Agency told us that it answers 90% of all calls within two minutes. The Auditor General begged to differ. The truth is that 34% of all callers actually get someone on the line, and a third of all callers are given incorrect information.
It is very hard to believe everything coming out of the Canada Revenue Agency. It is very hard to lend them credibility. That is why we need an independent study. I do not believe the numbers that the Canada Revenue Agency came up with in the course of its study of the so-called tax gap. I would have more confidence in the numbers from the Parliamentary Budget Officer, if he has access to the data that should be made accessible to him through this bill.
Percy Downe, the senator who introduced the bill, has a great deal of credibility in the area. He made this his pet issue and did not make a big spectacle out of it. He just wants to get to the bottom of this. He realizes that here in Canada, the Canada Revenue Agency is a problem.
The CRA's approach to collecting tax revenue across the country is problematic. The senator recognizes, as we do, that the CRA is acting arbitrarily. It changes its approach to collecting personal income tax depending on the individual's level of wealth. I am not making that up. It was in the Auditor General's 2018 report, which notes a lack of consistency in the CRA's collection processes.
Two different taxpayers will be treated in two different ways. That is not professional. It is unfair and perpetuates the perception that the CRA and the Government of Canada treat taxpayers differently based on their wealth or status.
This is a major problem because it indicates that this is a two-tiered system. In this system, the government will try to reach an out-of-court settlement with people who have the means to defend themselves. That is actually what we have seen. The government tries to resolve the situation by closing the file, because it will be too expensive to recover money from people who have the means to defend themselves. However, in the case of those who cannot defend themselves, the government takes quick action to recover the money.
We must standardize the way the agency does things and, above all, take away the Canada Revenue Agency's authority to assess the gap, because it will likely not do a very credible job. We must routinely ask the government to do its job, to exercise due diligence and to provide on a regular and ongoing basis the information requested by the Parliamentary Budget Officer to evaluate the tax gap.
That is why I am proud to support this bill.