The status of the case is uncertain. The Revenue Service of Canada (CRA) declined to comment on the case, as have federal prosecutors with the Canadian Attorney’s Office, which has been closely monitoring the case for years. KPMG did not respond to a request for comment. In a series of news stories dating back to 2015, CBC and Radio-Canada reported that KPMG had set up a process through which wealthy Canadians could transfer assets to a tax haven and then recover their money tax-free. The Isle of Man tax evasion system has been in place since 1999 and, according to documents filed with the Tax Court by the CRA in 2015, was “intended to deceive” the government.
The minister is no longer talking about the case
In 2017, Revenue Secretary Diane Lebouthillier promised to get to the heart of the matter and finally make the findings public. “We will go to the end and catch them,” Lebouthillier told Radio Canada in March 2017. “When everything goes public, it will be simpler.” He also confirmed that a criminal investigation was underway by both the investors and the accounting firm. Revenue Minister Diane Lebouthillier stands up during the questioning period. Lebouthillier declined to comment on an investigation into an alleged tax evasion scheme. (Justin Tang / Canadian Press) “Indeed, because for those involved in setting up a system, this is also criminal,” he said at the time. In an interview last week, however, Lebouthillier said the confidentiality of the file must be respected in accordance with the terms of the income tax law. “I can not talk about a specific case,” he said. He added that in any criminal investigation, the CRA cooperates with federal prosecutors. “The service is investigating all kinds of files,” he said. “Once the cases are settled, [the CRA’s investigators] cooperate with the Ministry of Justice to determine whether the cases are taken to court or not “.
Hidden assets
The CBC and Radio Canada have published many stories about the role played by KPMG – one of Canada’s largest accounting firms – in creating a plan to help multimillionaires hide their fortunes on the Isle of Man. The program allowed wealthy clients to avoid the tens of millions of dollars in taxes in Canada, making it look as if they had given their fortunes to foreign corporations. They received back their investment income as tax-free gifts. In 2016, a senior KPMG executive, Gregory Wiebe, told a parliamentary committee that this investment strategy had been externally verified and complied with the measures and standards in place at the time. Wiebe said the Isle of Man tax arrangement – which led the company to a $ 1.6 million fee for 16 projects – “fully complied with all applicable tax laws” in force in Canada in 1999 and has not been used. since 2003. Wiebe said the Conservative government’s tightening of fiscal protection rules in 2013 and 2014 changed the landscape dramatically. He said his own company is now carefully considering any tax savings plan for a “reputation” risk and to ensure it is legal and complies with general anti-tax avoidance rules. Also in 2016, a senior CRA official told lawmakers that investigations into the matter were ongoing – but did not say whether it was criminal or not. “We have taken the position that this particular structure of the Isle of Man does not comply. Only the courts can give us a final decision, and that has not yet happened,” said Ted Gallivan, now a senior Canadian Border Officer. Agency.
