Canada’s tax-gathering bureaucracy is eager to crack down on scams that attempt to hide taxable funds from scrutiny, although they seem to be rather more vigilant when it’s some poor slob who forgets to declare a grand or two from part-time work than multi-national organizations running decades-long scams to benefit deep-pocketed clients:
The Canada Revenue Agency has once again made a secret out-of-court settlement with wealthy KPMG clients caught using what the CRA itself had alleged was a “grossly negligent” offshore “sham” set up to avoid detection by tax authorities, CBC’s The Fifth Estate and Radio-Canada’s Enquête have learned.
This, despite the Liberal government’s vow to crack down on high-net-worth taxpayers who used the now-infamous Isle of Man scheme. The scheme orchestrated by accounting giant KPMG enabled clients to dodge tens of millions of dollars in taxes in Canada by making it look as if multimillionaires had given away their fortunes to anonymous overseas shell companies and get their investment income back as tax-free gifts.
KPMG is a global network of accounting and auditing firms headquartered out of the Netherlands and is one of the top firms in Canada.
“Tax cheats can no longer hide,” National Revenue Minister Diane Lebouthillier promised in 2017.
Now, Tax Court documents obtained by CBC News/Radio-Canada show two members of the Cooper family in Victoria, as well as the estate of the late patriarch Peter Cooper, reached an out-of-court settlement on May 24 over their involvement in the scheme.
Details of the settlement and even minutes of the meetings discussing it are under wraps. A CBC News/Radio-Canada reporter who showed up to one such meeting this spring left after realizing it was closed to the public.
Journalists discovered references to the final settlement agreement in Tax Court documents only by chance.
