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Cracking down on tax evasion and aggressive tax avoidance and getting results

Introduction

The Government of Canada is committed to cracking down on offshore tax evasion and aggressive tax avoidance to ensure a tax system that is responsive and fair for all Canadians. With a historic investment of nearly $1 billion in Budgets 2016 and 2017, the Government of Canada, through the Canada Revenue Agency (CRA) has taken concrete action to crack down on tax cheats. This investment is helping to ensure that the CRA has the tools at its disposal to continue its efforts and to step up enforcement, to combat tax evasion and aggressive tax avoidance, and to improve the fairness and integrity of the tax system for all Canadians.

Getting results

The CRA has taken action on several fronts to crack down on tax cheats by focusing resources in the areas of highest risk, both domestically and internationally. These efforts are resulting in concrete results for Canadians. As such, the CRA is making available results of the important work it is conducting to tackle tax evasion and aggressive tax avoidance. The CRA is committed to ensuring that Canadians have access to this data and the progress it is making on these important issues.

Cracking down statistics

Description	2014-2015	2015-2016	2016-2017	As of the end of 2016/2017
Fiscal Impact - Agency	$11,731,224,458	$12,687,083,234	$12,513,190,217
Fiscal Impact - large, international, offshore, aggressive tax planning	$7,814,312,534	$7,975,864,386	$7,970,568,046
Fiscal Impact - aggressive tax planning	$1,445,997,042	$1,966,121,677	$1,767,247,652
# of files received for application of General Anti-Avoidance Rule (cumulative since inception)	1,267	1,333	1,392
% of cases where General Anti-Avoidance Rule was recommended for application	78%	79%	79%
# of international exchanges under legal instrument	1,212	1,075	892
# of offshore audits completed	98	185	223
# of calls to the Offshore Tax Informant Program	1,447	973	841
# of written submissions to the Offshore Tax Informant Program	144	115	110
# of contracts with informants through the Offshore Tax Informant Program	6	10	10
# of taxpayers under offshore audit as a result of the Offshore Tax Informant Program information				227
# of offshore audits completed as a result of the Offshore Tax Informant Program information	N/A	2	25
$ in federal tax and foreign reporting penalties assessed through information received through the Offshore Tax Informant Program	N/A	$10,148	$1,604,524	$1,614,672
# of electronic funds transfer transactions analyzed for jurisdiction projects		3,095	38,194	41,289
$ of electronic funds transfer transactions analyzed for jurisdiction projects		$866,699,733	$11,393,818,907	$12,260,518,640
Total number of alternative compliance treatments (e.g. nudge letters) resulting from jurisdiction projects	N/A	N/A	4,544
Number of taxpayers identified for audit resulting from jurisdiction projects	N/A	N/A	142
$ of third party penalties on promoters and tax preparers (all programs)	$36,730,101	$212,914	$44,310,377
# of cases referred for criminal investigation	244	377	335
# of search warrants executed	39	100	123
# of files where criminal charges were laid under the Income Tax Act, Excise Tax Act, and/or Criminal Code	30	19	32
# of investigations as a result of joining forces operations with other law enforcement agencies	1	13	12
Conviction rate	96%	88%	89%
# of convictions for tax evasion	95	50	37
$ of federal tax evaded related to convictions	$12.5 million	$16.4 million	$32.7 million
# of taxpayers sentenced to prison terms ^{Footnote 1}	34	22	24
# of years of prison terms imposed	57	44.5	50.6
$ of court fines imposed	$9.7 million	$4.1 million	$10 million

What can you do?

There are serious consequences to tax cheating. To learn more, go to Tax cheating. There are consequences.

Be aware of your reporting obligations

Taxpayers must report certain assets with a total cost of more than $100,000 on Form T1135, Foreign Income Verification Statement, by the filing due date of their income tax return. They must also make sure that they have properly reported any foreign income and gains on their income tax return.

Submit information to the Offshore Tax Informant Program

Are you aware of a situation or do you have information regarding international aggressive tax avoidance? To learn more, go to How to submit information to the Offshore Tax Informant Program.

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Cracking down on Tax Evasion and Aggressive Tax Avoidance and Getting Results