It has been disconcerting to hear news of the Harper government’s changes to the Canada Revenue Agency (CRA). Particularly troubling is the lack of support for the division responsible for pursuing offshore tax evaders, who park their profits in other countries and avoid paying their fair share of taxes that all other Canadian individuals and businesses are obligated to.

In the fall of 2013, Canada’s Auditor General Michael Ferguson released a report entitled “Offshore Banking – Canada Revenue Agency.” Among other things, it focused on the Liechtenstein list, which was first received by the CRA in 2007 from an informant, and supposedly included the names of 182 Canadians with offshore bank accounts in Liechtenstein. From that list, the CRA was able to pursue $24.651 million in federal taxes, interest, and penalties.

The Auditor General went on to commend the CRA for recovering some funds, but issued a stern assessment with regards to the growing burden of work in this area of tax evasion. While some funds were recovered, it only represents a fraction of the 182 individuals, and more information is flowing to the CRA about potential transgressors. Informants, incentivized with the potential to be awarded a portion of any new taxes, interest, or penalties earned, are coming forward with more cases than ever that are in need of thorough investigation.

It is because of this that the Auditor General concluded his report with a clear message to the federal government and the CRA; that they are not prepared to handle any influx of offshore tax evasion cases, and need to give this department the proper resources it needs to successfully pursue tax evaders.

As Vice-Chair and Liberal member for the Public Accounts committee, we studied the Auditor General’s audit, and issued a report from the committee to Parliament with the recommendations from all three parties involved in the report process. The conclusion stated that our committee reiterated the need for the CRA to ensure it is prepared to meet the growing workload of offshore banking issues, and we were pleased that the CRA appeared to have a plan ready to implement that would acknowledge their shortcomings and solve them.

In addition to this, the Public Accounts committee underscored the expectation Canadians have for the CRA to efficiently and successfully pursue tax dodgers. This includes taking lessons learned from the Liechtenstein list and other investigations, and formulating an action plan that will find success.

The important point to note is that the federal government is shortsighted in its goals. It is trying to squeeze more money out of the CRA to balance its own budget, and does not see the big picture. Those with the means to hide their earnings offshore tend to have accounts into the millions of dollars.

Recovering federal taxes, interest, and penalties from offshore banking tax evaders has been proven to bring in millions of dollars, and we have not yet fully grasped the extent of how many Canadians are funneling money offshore. The potential income for the government to pursue these tax evaders has the possibility of generating revenue that far outpaces the cost to CRA of investigating these individuals.

It’s also important to send a message to Canadians that if you try to circumvent the tax system, our Canadian government will ensure you are caught and held to account for your actions as an individual or business. Now that the CRA has admitted it is not being allowed to dedicate the resources it needs for this division, tax evaders will be given an open window with which to commit these crimes.

I find it shocking that six months ago, the Harper government had acknowledged the deficiencies laid out by the Auditor General, and resolved in Parliament to take the necessary action and make the investments required to reduce or eliminate offshore tax evasions. Now, they have decided the short-term goal of saving some money at the CRA is more important than the long-term goal of higher revenues, and ensuring that all Canadians must pay their taxes as a basic contribution to the function of our society and government.

Yvonne Jones, MP

Yvonne Jones is the Vice-Chair of the Federal Public Accounts Committee. She is also the Member of Parliament for Labrador.