Finance committee  First, yes, it is the case that we have a very good exchange-of-information procedure with the U.S. In many cases, information with the U.S. is exchanged automatically. My colleagues can speak to that, but it's very advanced, if you will. The second point is in relation to the new jurisdictions, if you want to call them that, which are coming on and agreeing to an exchange of information, perhaps for the first time, with us and other countries.

Finance committee  Again, I'm sorry, but we don't know what we don't know. You can make assumptions about some of this stuff, and that will certainly produce a number--

Finance committee  Mr. Chairman, may I jump in here for a moment? I think the honourable member is conflating two different points. One is the legitimate concern, and that's what we've been trying to address, of those who would seek to hide income in foreign financial institutions. The other is the taxation of investments of Canadian financial institutions themselves abroad.

Finance committee  My colleagues from CRA may have other comments, but I would say that we believe that reducing the opportunities to evade tax will reduce tax evasion. What we're doing as a policy shop at Finance is to try to put forward, as you call it, those tools to allow CRA better access to information and thereby to reduce tax evasion.

Finance committee  That's a fair question. I would say that at this stage it remains unanswered, because the tax information exchange agreements we've signed have not yet themselves been brought into force. One of them was tabled earlier this year, or perhaps even late last year; 10 more were tabled within the past few days, I guess, to be—

Finance committee  Again, we can run arithmetic together, Mr. Chairman, but it would all be based on assumptions. If you wanted to say 10% of what the Americans—

Finance committee  Frankly, I'm not familiar with the U.S. estimate, or that it's a Treasury estimate, or how it's framed or constructed.

Finance committee  No, I don't think it necessarily points to that at all. I think there's a large amount of investment made by Canadian multinationals in a number of jurisdictions, including Barbados, Bermuda, and others, and it's reflected by the investment of other countries as well. These places are important destinations for investment.

Finance committee  No, we don't have those estimates. It's possible to create estimates using assumptions, but by its very nature the amount of tax evaded is a very difficult thing to determine. It's by definition that which you do not know. So one could make assumptions, as I've said, to estimate what some call this tax gap—

Finance committee  I simply want to say that is not our proposal. We are seeking, through the mechanism I've already described, to deal with the issue of tax evasion through more transparency, specifically through exchange of information agreements that allow Canada to collect information that allows CRA to conduct its audit and enforce its taxes.

Finance committee  I'd like to introduce myself and my colleague, if I may, and we could make a couple of remarks, if the committee wishes to have us do so.

Finance committee  My name is Brian Ernewein. I'm the general director in the tax policy branch at the Department of Finance. I'm joined by my colleague, Alain Castonguay, who's the head of our tax treaty and tax information exchange agreement section at Finance. Thank you very much for the opportunity to appear before the committee today to discuss the subject of offshore bank accounts held by Canadians, the actions being taken by Canada to combat international tax evasion, and Canada's involvement regarding the work of the Global Forum on Transparency and Exchange of Information for Tax Purposes.

Public Accounts committee  It depends on the taxpayer. For individuals, it's three years; for large corporations, it's four years.

Public Accounts committee  Well, I have a couple of points. First of all, your assumption, Mr. Chairman, is very much the same as our own was; that is to say, there'd be a high behavioural response to the court case finding that a certain return was tax-free. A lot of people would seek to transform their returns into exactly that, and that was the reason for the proposed change.

Public Accounts committee  The short answer is yes. In terms of the log we keep of technical amendments and concerns, there are provisions that don't get a priority because they aren't very important. Among those would be those that relate to parts of the Income Tax Act that have come and gone. I can think of a couple of examples relating to the large corporations tax.