CRA Scare Tactics are working

I am having fun tracking this subject with all the spin doctoring going on. It is amazing to see how CRA is so effective in their scare tactics.

While I agree, Canadians need to report all their income and prepare their tax returns completely and honestly, I don’t agree that a voluntary disclosure is the right answer.

In most cases, there are much better ways to handle coming clean.

For more information on alternatives to Tax Amnesty / Voluntary Disclosures.

Go to www.tax-audit-solutions.com and www.danwhite.ca

or email dw@911Taxes.com

Dan White

________

here is John Greenwood’s interesting article on what the Minister of Revenue has to say, and what

Steven Kohn, the lawyer for Bradley Birkenfeld, a key whistleblower in the UBS case has to say;

Canada’s tax cheats confess in record numbers

6,798 people holding $1.66-billion in hidden assets come clean with CRA

John Greenwood, Financial Post  Published: Wednesday, December 02, 2009

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A flood of Canadian tax cheats are voluntarily coming forward to disclose hidden assets and offshore accounts in record numbers, says Jean-Pierre Blackburn, the Minister of National Revenue. Reuters A flood of Canadian tax cheats are voluntarily coming forward to disclose hidden assets and offshore accounts in record numbers, says Jean-Pierre Blackburn, the Minister of National Revenue.

A flood of Canadian tax cheats are voluntarily coming forward to disclose hidden assets and offshore accounts in record numbers, says Jean-Pierre Blackburn, the Minister of National Revenue.

As of Wednesday, 6,798 Canadians had come clean to the Canada Revenue Agency since the start of the year, revealing $1.66-billion of assets they had not paid tax on, or about 50% more than in the whole of 2008, Mr. Blackburn said in an interview.

The jump in the numbers is because people are getting the message that “people should pay their taxes” after publicity around a recent string of tax-evasion cases, he said.

“People realized that it’s a question of time before we get them,” he said. “I tell them, we’ll get you, we’ll find you.”

The comments come after tax authorities in the United States announced last month that 14,700 well-heeled Americans had confessed to evading taxes to take advantage of the government’s amnesty program.

The lion’s share of those cases involved hidden offshore accounts with UBS AG, which agreed this year to reveal the names of 4,450 U.S. clients with US$18-billion in hidden assets.

Despite evidence that many well-heeled Canadians also hid money with UBS, only a trickle disclosed the information to the CRA, which has led some observers to complain the government is not doing enough to fight tax evasion.

Indeed, of the nearly 7,000 people who came forward in Canada, only 90 involved UBS cases. The rest involve either different offshore banks or other forms of tax evasion, Mr. Blackburn said.

He said the critics are failing to take into account this country’s overall very strong record on persuading Canadians to pay their taxes, which compares well with the United States where in a typical year very few tax cheats come forward.

Under the law, Canadians can avoid legal penalties and fines if they voluntarily disclose assets they are not paying taxes on and there is no deadline. By doing so, they are liable only for the taxes and accrued interest.

South of the border the laws are a lot tougher and in the case of UBS there is a deadline, with no breaks for people who fail to confess in time. On top of that there are rewards for whistleblowers.

“I think our system is a lot better, more [attractive] for Canadians to use,” said Mr. Blackburn.

Not everyone agrees with that.

A central figure in the UBS case Wednesday slammed the CRA for failing to take tax evasion seriously.

Steven Kohn, the lawyer for Bradley Birkenfeld, a key whistleblower in the UBS case, said the Canadian government needs to put in place laws to protect people who come forward with information about tax evasion and reward those who help the government collect revenue that is owed to it.

“The first issue is, does the Canadian government really want to stop tax evasion, and if they want to stop it we now know the steps that have to be taken to do that?” said Mr. Kohn. “Any government that is not instituting effective whistleblower programs is really turning their back on most effective detection mechanism for fraud.

“Canada does not have good whistleblower protection,” said Mr. Kohn. “It’s kind of remarkable that they’re lagging behind [so many other countries.]”

jgreenwood@nationalpost.com

Read more: http://www.financialpost.com/story.html?id=2295700#ixzz0Ydn0JNRd
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