UPDATE: A Lack Of Appetite: The Canadian Government, The CRA, And Tax Avoidance

 

While I have written extensively in the past about tax evasion and avoidance in light of the revelations of both the Panama and Paradise Papers, I felt it was time to do an update. To summarize what I wrote previously, there has been a striking reluctance on the part of our government, compared to other jurisdictions, to go after the entitled who have sheltered so much income in offshore accounts.

Consider, for example, France. as reported in La Monde.

Seven years [after the Panama Papers release] and hundreds of audits later, France has already recovered €195.5 million in tax revenue for the state budget... 

Rendered invisible in offshore arrangements, this money corresponds to 219 taxpayer files, both individuals and companies, caught in the net of the Panama Papers. It's the sum of all financial audits completed by December 31, 2022, as well as regularizations made.

This sum

place[s] France in the club of five countries to have recovered more than €100 million in taxes and penalties thanks to the Panama Papers, along with the UK, Germany, Spain and Australia.

Moreover, the cumulative amount recovered is greater:

All told, from the Offshore Leaks (2013) to the Pandora Papers (2021), the sum recovered today stands at over €450 million. However, this figure will remain incomplete until all checks have been completed.

By contrast, it would appear that the pursuit of tax scofflaws by Canada has been far less vigorous. While is is difficult to find any current reports, two Senate of Canada reports do not paint a rosy picture. The first, from 2019 and written by Senator Percy Downe, has this to say:

The Canada Revenue Agency (CRA) is up to its old tricks: misleading Canadians and not upholding its responsibilities to collect taxes owed to our country by those hiding their money overseas. When tax cheats are not caught, charged and convicted, and money owed isn’t collected, we have less money to invest in our priorities while the rest of us pay higher taxes to make up the shortfall.

Why the federal government allows this state of affairs to continue year after year remains a mystery. The government talks tough, “overseas tax evasion is a high priority”, “we will catch you if you cheat” and other reassuring words. Their results, however, speak for themselves: they have none.

Recently, on the third anniversary of the release of the Panama Papers, we learned that other countries have recovered more than $1.2 billion dollars in fines and back taxes. Australia has recouped $92,880,415, Spain is counting $164,104,468 in their coffers, the United Kingdom has recovered $252,762,000, and even tiny Iceland was able to recover $25,525,959. Some 894 Canadians (individuals, corporations and trusts) were revealed to have accounts in the Panama Papers, but Canada’s Revenue Agency hasn’t recovered a dollar.

A second piece by Downe, written two years later, reported no progress. 

In the immortal words of the Parliamentary Budget Officer, "there are hundreds of millions, if not billions, of dollars in taxes that go undeclared, unreported and that escape Canadian tax authorities, probably on an annual basis...”

The Canada Revenue Agency (CRA) has failed when it comes to collecting any of this money hidden overseas. Notwithstanding the CRA’s highly effective domestic tax collection, they have been an utter disaster on overseas tax evasion. Canadians are allowed to have accounts overseas but it is illegal not to declare the proceeds of those accounts.

This inaction costs all of us, considering how the foregone tax revenue would provide a healthy injection into a myriad of much-needed programs in Canada. 

In Canada, there is no risk to hiding your money overseas because your chances of being charged or convicted range from slim to none. The "hundreds of millions, if not billions, of dollars in taxes that go undeclared ... probably on an annual basis” identified by the PBO will not, by itself, solve our financial problems — but it will go a long way to restore prosperity for Canadians.

The failure to collect taxes owed undermines confidence that everyone is being treated equally. If we are all in this together, then we all pay taxes. Otherwise, there is special treatment for some Canadians with the resources to hide their money, while the rest of us must pay more to make up that shortfall.

There is much work to do. Since nothing else has worked, it’s time for solid action rather than empty words from the Government of Canada.

One is naive to believe that the CRA is truly independent of government influence. One may recall, for example, that Stephen Harper siced it on NGOs that were critical of his government, and despite the promising rhetoric at the beginning of Justin Trudeau's tenure, it is clear that certain entities (think corporate and individual titans) are essentially off-limits. 

I have said it several times here, that Mr. Trudeau has never met a powerful entity he doesn't admire. Perhaps he picked it up through his upbringing or his reported forays to Davos to meet with the world's elite. 

One thing is undeniable, however. His bromance is costing the rest of us plenty, both in terms of a loss of faith in the fairness of our tax system, and the underfunding of programs that could benefit all of us, if only we had access to Canadian elites' tax on their concealed wealth.

UPDATE: The G20 wants to impose a minimum global tax on billionaires. Keir Starmer, Britain's Labour leader, promises no new taxes on the wealthy if elected. I suspect Justin Trudeau shares Starmer's aversion to holding the ultra wealthy to account.

 

 

The Language Of Genocide

 

“Political language is designed to make lies sound truthful and murder respectable, and to give an appearance of solidity to pure wind. ”

― George Orwell

It is very easy, in the majority of cases, to become quickly inured to the world's suffering. Whether it be earthquakes and crime in Haiti, famine in Africa, or the war Russia is waging against Ukraine, we reach the point of compassion fatigue, facilitated no doubt by the lack of any apparent resolution to the dire circumstances so many experience in today's fractured world. 

One hopes against hope that the genocide taking place in Gaza may prove an exception, however, despite the efforts of so many to make the Israeli response to the October 7 attack by Hamas look both reasonable and necessary. And one of the latest to make such an effort is our own (were it not so) Stephen Harper.

Shree Paradkar writes:

On Wednesday, former Canadian prime minister Stephen Harper was in Jerusalem, shaking hands with the butcher of Gaza, Israeli Prime Minister Benjamin Netanyahu. According to his tweet, Harper witnessed "an Israel scarred by the unprovoked horrors of Oct. 7, but also united in its determination to end the threat of Hamas once and for all."

"Unprovoked." "Ending the threat of Hamas." Phrases being repeatedly used to justify the unjustifiable.

It is no doubt a human tendency to try to interpret the world along absolutist terms; things are either good or bad, thereby circumventing the hard work that critical thinking requires. For his fellow travellers, Stephen Harper is providing such a service.

But historical context is needed.

The Hamas commander named the attack "Al Aqsa Floods" saying it was meant to avenge Israel's brutal attacks on Al Aqsa mosque in East Jerusalem — long a flashpoint site — during Ramadan in 2021.

Whatever one makes of that statement, it's a reminder that one can't look at what's happening without context. Insisting on erasing the context of current events — as seen with the repetition of the word "unprovoked" — is very much in Israel's interest. It allows Israel to position itself as the innocent party and to reduce the unspeakable violence it has unleashed to a "they-asked-for-it" rhetoric.

But there is much more involved here, years of abuse and repression that the world refuses to acknowledge.

There is so much mutual pain in the region that to ignore the underlying conditions of violence is to create conditions that lead to violence.

Some of these conditions include decades of repressive and vicious Israeli military occupation in Palestinian territories, with Israel routinely displacing, imprisoning and killing Palestinians. Israel's illegal blockade segregated Gazans from the world for years by banning them from travelling outside. The majority of Gazans are refugees who face sweeping restrictions on the entry and exit of goods. Israel even controlled the flow of electricity and water; more than 90 per cent of the water in Gaza was unfit for consumption before Oct. 7. A Washington Post report found there had been no natural surface water in Gaza since the early 2000s.

For even greater context, there is an array of videos available on YouTube attesting to the mistreatment of Arabs in the entire region.

Paradkar also talks about how the Palestinian cause has been conflated with Hamas and Islamic extremism, making it easier to dehumanize them, meaning

no matter how Israel treats Palestinians, whether it attacks Gaza's hospitals, kills and maims children, doctors, academics and journalists, or whether the International Court of Justice has ruled that Israel must take action to prevent genocidal violence by its armed forces, in Israel's view and in the eyes of its Western allies, it remains the wronged party.

It is this mentality that Harper has shamefully tapped into, making it easier to minimize and justify Israel's ongoing atrocities. 

Decades ago, George Orwell warned us about the destructive effects of political language. Sadly, it seems we have learned little to nothing in the intervening years.

Two Strong Black Women And A Racist Meet At The Bar

Two strong Black women,  Fanni Willis in Georgia and Latitia James in New York, have proven relentless in their pursuit of justice. As proven last week, despite efforts to disqualify her from prosecuting Trump, Willis is defiant, indeed, contemptuous, of the efforts to stop her. 

You can watch her full testimony here.

Similarly, James has every intention of seizing Trump's assets if he doesn't pay the monumental fine imposed in his financial fraud case.

Oh, how it must enrage that well-known racist and misogynist, Trump, and his MAGA cult, to see these indefatigable Black women give him no quarter.

I love it.

Not To Put Too Fine A Point On It

 ..... but

H/t Theo Moudakis

UPDATED: Egregious Incompetence Or Egregious Indifference?

I realize that progressives are largely loathe to criticize the Trudeau government. Given the simplistic, either-or, black-and-white thinking of much of the electorate, such criticism is fraught with peril. For that significant segment of shallow voters, the reasoning seems to be that if the current government is found wanting, the only alternative is to support PP and his Conservatives. Why the NDP is almost never considered as an alternative is a bit beyond me.

Nonetheless, we do no one any service if we ignore or minimize the egregious shortcomings of our current government. Two recent reports highlight what is either federal incompetence or massive indifference. The first pertains to the almost unbelievable cost of $60 million (from an original estimated cost of $80,000) to develop the botched ArriveCan app, which earned a scathing rebuke from Canada's Auditor-General, Karen Hogan.

Overall, Hogan found that the Canada Border Services Agency (CBSA), the Public Health Agency of Canada (PHAC) and Public Services and Procurement Canada "repeatedly failed to follow good management practices in the contracting, development and implementation of the ArriveCan application."

"This is probably the first example that I've seen such a glaring disregard for some of the most basic and fundamental policies and rules," Hogan told the House public accounts committee on Monday.

The Star's Rosie Di Manno had this to say:

It was supposed to cost $80,000. Maybe your tech savant kid could have done it for 80 bucks.

Serial incompetence which caused the Canada Border Services Agency to release 177 versions of the digital software between April 2020 and October 2022 — driving travellers nuts — and at one point falsely informed 10,200 users that they needed to pandemic quarantine for two weeks. While outsourcing companies — from which the contracted firms raked in hefty commissions of 15- to 30-per-cent — actually did no work on the project at all, CBSA officials were wined and dined at various restaurants and breweries (one off-site virtual meeting was dubbed “ArriveCan Whisky Tasting’’), and five of eight federal health bureaucrats racked up $342,929 in bonuses over those two years.

It is almost as if the government had a giant Kick Me sign attached to its metaphorical rear end.

Everything about rolling out the ArriveCan app was reckless and negligent at every stage, crucially in sole-source contracts with GC Strategies, in reality a two-person outfit that hired subcontractors to do the actual IT work, 76 per cent of which did not work at all, according to Hogan’s findings.

“The Canada Border Services Agency’s documentation, financial records and controls were so poor that we were unable to determine the precise cost of the ArriveCan application,’’ wrote Hogan. At a news conference afterwards, she continued to flog just about everyone involved. “Overall, this audit shows a glaring disregard for basic management and contracting practices throughout ArriveCan’s development and implementation.’’ Adding: “This is probably some of the worst financial record keeping that I’ve seen.’’ 

And this taxpayer contempt is not the worst of the government's crimes. No, that distinction has to go to  the feds' inability to rouse themselves from their torpor to fill a growing list of judicial vacancies, vacancies that are having some real-world consequences. In a case filed by a human rights lawyer, Federal Judge Henry Brown issued a rebuke to the Trudeau government:

Brown says Prime Minister Justin Trudeau and Justice Minister Arif Virani failed to do what Wagner asked and are failing Canadians who rely on the justice system.

There were 85 vacancies when Wagner wrote his letter in May, 79 when the case was filed in June and 75 on Feb. 1.

Things have reached a crisis level. Given the Supreme Court ruling that trials must be conducted within 30 months of charges, a number of prominent cases have recently been tossed for violating that stipulation, including ones for human trafficking and sexual assault.  Such transparent injustices can only cause the further erosion of faith in the justice system and, by extension, democracy itself.

This post has attempted to describe what happens when a government grows jaded, tired, and contemptuous of the people it was elected to serve. This happens all the time, but what surprises me is the speed with which the federal Liberals resurrected their arrogance after being in the penalty box for so long.

Clearly, they have done so at their electoral peril.

UPDATE: Theo Moudakis offers this succinct assessment:

 

 

 

Political Pandering Of The Worst Kind

In the ongoing debasement of democracy, Ontario's Doug Ford is certainly playing his part. With his populist deck fully stacked, his latest effort to pander to the lowest common denominator has been dealt: no more driver's licence plate renewals! 

This is wrong on a number of levels, but worst of all in the way that it plays to the notion that government exists only to make life easier for the individual, not society as a whole. And the problem this measure seeks to address? The fact of over one million lapsed plates; since Ford scrapped licence renewal fees, many have forgotten that they still have to renew them online.

“I’m here to announce today, actually, that we’re getting rid of that totally — registering your vehicle,” Ford said.

“We did the first step: getting rid of the sticker. Now, we’re getting rid of the re-registration. They’ll be automatically re-registered. So people won’t have to worry about that at all.”

Now, if one has a Machiavellian cast of mind, one will see the political advantages for Ford. Not only does it enhance his "street cred" with Joe average, it also puts the opposition parties on notice - oppose this measure and you will be seen as elitist and out of touch. My guess is that both Marit Stiles and Bonnie Crombie will have little to say about it for that reason. However, if they are smart they can object to it with conviction and practicality.

Putting aside the ongoing infantilization of the electorate, all they have to do is talk about the danger of increasing the numbers of drivers with no insurance, Up to this point, to renew one's plate, one had to provide proof of insurance coverage. That requirement is now gone, and hence, the roads will pose even more danger than they already do.

But this government is all about short-term advantages, not long-term consequences. Sadly, I expect it will boost the Ford government's popularity considerably.

Continuing with A Theme....

 

H/t Theo Moudakis

The Art Of Misdirection

 Well-played, Danielle.

H/t Graeme Mackay

Given that only 0.0037 of Albertans over 15 identify as transgender or non-binary, that is quite the feat!

History: An Update

As one who taught high school for 30 years, I have always believed in the power of education. It is the best and perhaps the only way to narrow the disparities that exist in society. In my experience, the truly educated are rarely the ranters who seem to dominate media today.

In my previous post, I talked about how many reactionary states are bound and determined to limit  education about Black history. Not only would such instruction empower Black people; it would also help to reduce the prejudice that is still very common against people perceived as "the other." To know about a rich history would limit the kind of reductionism that often defines Black people today.

At this point in my life, I am profoundly world-weary. But even this cynical, hardened heart was gladdened by news that the Ontario Ford government is going to make Black history a mandatory part of the curricula in Grades 7, 8, and 10, starting in 2025.

Stephen Lecce said Black history is Canadian history and adding it as a mandatory part of the curriculum will ensure the next generation will better appreciate the sacrifices and commitments Black Canadians have made.

"We are committed to ensuring every child, especially Black and racialized children, see themselves reflected within our schools. It is long overdue," Lecce said during a Thursday morning news conference at Lincoln Alexander Public School in Ajax. 

While I rarely have anything good to say about the Ford government, this is one initiative I heartily applaud. 

MPP Patrice Barnes, the parliamentary assistant to the education minister, spearheaded the curriculum change and said she wants it to deepen students' understanding of the country's diverse and vibrant heritage.

"Celebrating the remarkable achievements of the Black community within Canadian history is vital in providing a modern curriculum that reflects the truth of our democracy, one that combats hate and fosters inclusivity," Barnes said.

"This isn't just about Black experiences, it's not just about Black students. It's about the responsibility we have to provide all students with a comprehensive understanding of our country's rich and varied history."

This kind of curriculum was, of course, entirely absent when I was a student. Consequently, I grew up with little thought about the Black experience, usually equating and identifying Blacks with the sordid history of slavery. And it is clear that such education is sorely needed in Canada. Edward Keenan writes that we cannot be smug about being so different from the Americans, whose MAGA mentality drips with racism:

If anyone were under the impression the border keeps such thought currents from infecting Canadian politics, Pickering city councillor Lisa Robinson was recently happy to demonstrate otherwise, writing a column in a local newspaper arguing against observing Black history month (and indeed, the teaching of Black history) and outlining how it is racist to call her "white priviledge" (sic) and explaining how having her pay suspended for 90 days recently by her colleagues made her a "modern day slave," demonstrating that slavery is "not a Black and white issue." She then reminded people of the era "during the world wars" in the early 1900s when, she claims, soldiers sacrificed "without thought or division based on colour" (which might have been news to the soldiers serving in the segregated Black No. 2 Construction Battalion in the First World War, as well as to the 20,000 Canadian-born citizens of Japanese descent interned in camps during World War II).

That we have our own version of Marjorie Taylor Greene in elected office should be a comfort to no one, and, of course, Lisa Robinson is hardly alone in her prejudices. One hopes that with the education revisions just announced, we will see far less of her kind in the future.

History And Pride

For the past couple of years I have been reading about the antebellum South, the Civil War, and the so-called Reconstruction era that followed. My reading has uncovered a number of things that I was either unaware of or knew only in a vague, general sense. 

History is a great teacher, but for many states, especially Florida, it is fraught with danger - the danger that Black students will learn, in depth, not only about the slavery that shackled them for over two centuries in North America, but also about the tremendous contributions they made to the economy, culture and society of the United States. 

My own theory is that much of the educational censorship people like Ron De Santis engage in is predicated on the fear of Black Pride. Learn about your history, learn that you are much more than the menial roles society has assigned you, and you become angry, empowered, and a threat to the status quo.  Racist white America has much to fear.

Given that this is Black History Month, the following gives us a brief window into something I, and I am sure many others, were unaware of.

Not all shackles are physical. Knowledge is power, as is pride, and hence for the racist gatekeepers, threats to be kept under wraps when it comes to Black America. 

Stupidity Is The Real Threat

There is an article in today's Star about the threat to Canadian democracy posed by artificial intelligence. However, I can't help but wonder if the real threat is human stupidity.

Raisa Patel writes:

Whether it’s manipulated video, voices or text, Canada is at risk of seriously endangering its democratic institutions if it doesn’t get a grip on regulating artificial intelligence, one of the world’s foremost AI leaders warned Monday.

The use of such tactics — which are becoming increasingly common at a time when high-stakes elections are set to be held around the globe — “can fool a social media user and make them change their mind on political questions,” said Yoshua Bengio, scientific director of the Mila-Quebec Artificial Intelligence Institute. 

“There's real concern about the use of AI in kind of politically oriented ways that go against the principles of our democracy.”

Bengio, who is also the co-chair of Innovation, Science and Economic Development Canada’s AI advisory council, was speaking to the House of Commons industry committee as it studies a bill seeking to reign in and regulate the rapidly developing technology. 

Given that fake videos and voices have now reached the point where they are virtually indistinguishable from the real thing, it is sad that there is no inoculation available against human credulity. 

On the other hand, however, is it really too much to expect people to inspect their sources? Surely it is one of the 21st century's greatest ironies that we live in a time when the world's information and knowledge is available literally at our fingertips, yet many people choose to use the internet simply to verify their own ignorance and prejudices. Instead of checking a reputable media source or even Snopes to see whether something is true, there are those that will rely only on their Telegram channels, Q-Anon, Facebook groups and other discredited sources, happy to label and dismiss mainstream media as lamestream media. 

That is capitulation, not critical thinking, and it appears to be endemic. I found myself thinking more about this last night as I watched the news about the latest Trump outrage. Apparently, even though a private citizen, he is giving direction to Congress to block a southern border deal because he wants to make it an election issue. While not a perfect bill, it becomes painfully obvious that a problem near and dear to so many Americans, and a clear Achilles Heel for Joe Biden, takes a back seat to the political machinations of Trump and the gutless Republicans who pay him complete obeisance.

In a normal world where people thought deeply about such things, all of this would be so obvious. Yet the MAGA crowd and others will undoubtedly let weak and corrupt politicians do their thinking for them. 

In Canada, things are not much different. Increasing numbers prefer PP's aphorisms ("Axe the tax", "Jail, not bail") to real policy discussion. Sadly, no legislation regulating artificial intelligence here can do a thing about a dearth of natural intelligence. As I have said many times before, we truly are a deeply flawed species.

For A Few Dollars More

That's all it will take (actually, $12 million more) according to Police Chief Myron Demkiw to keep chaos and blood from running in the streets of Toronto. Reeling from the effort of city council to trim $12 million from what some might say is an already bloated ask of $25 million for a total budget of $1.1 billion, the good chief is warning of slower response times and all manner of disaster if his demands are not fully met.  

Clearly, the chief is engaging in fear tactics to get his way, despite the fact that increasing police budgets does not correlate with safer streets:

A recent University of Toronto-led study found no consistent relation between police funding and crime rates across 20 Canadian municipalities, including Hamilton and Toronto. Lead author Mélanie Seabrook said the key takeaway for legislators is to give community needs and priorities more consideration when setting budgets.

Brighter minds than I offer some strong suggestions about what the chief and his ilk can do with his demands:

City budget spinning from police could be a big problem: Keenan, Jan. 31

Here we go again with all the ballyhoo about the police budget. What I would like to know is how much of the budget is slated to be paid to suspended officers who are sitting on their butts at home while collecting a full pay cheque? It is long overdue for the mayor to ask the powers to be to provide a complete breakdown of the monies paid out to suspended cops over the years and to ask how many inevitably had to leave the service yet walked away with thousands of unearned money from taxpayers.  The police act is long overdue for an overhaul especially in these trying times when citizens cannot afford the basics of life.

I have said it before: if an officer is on paid leave, put their earnings into an interest generating trust account. He or she gets the money if they return to service, and if not, those funds are redirected to the police force. It is a simple solution to a long-standing problem.

Larry Snow, Oakville, Ont.

There was an interesting contrast of articles from columnist Edward Keenan and Police Chief Myron Demkiw regarding the police budget. What struck me was how the chief says how terrible things are in the service and somehow a loss of $12.6 million is a major threat to our safety. If the biggest city in the country is at risk of chaos due to the lack of $12.6 million it is time for the politicians to demand that a third-party independent forensic team review police service spending from top to bottom to see the truth of the matter. 

Len Bulmer, Aurora, Ont.

 Rather than attempting to intimidate the residents of Toronto by writing of facts without nuance, our police chief Myron Demkiw should be looking for the means to make his force more efficient and effective. I suggest Premier Doug Ford, who can always be counted on to have an interest in city spending, be brought in to rout out the waste in the police budget.

Peter Pinch, Toronto

Myron Demkiw, chief of the Toronto Police Service, is misleading us. He points out there are 1.4 million emergency calls to 911 a year, but does not say the majority of 911 calls do not involve violence and can be dealt with by community and social workers. He says that more officers equal less crime, but years of research has shown that the crime rate does not correlate to police spending in any consistent way.

Toronto is one of the safest cities in North America. The key to crime prevention is through reducing inequality. To reduce response times, we need better management of the 911 service, diversion of nonpolice calls and smarter deployment. But no, our police leadership doesn’t want to follow evidence. If they truly cared about our safety and well-being, they would support investment in stronger community and social supports. That is how we’ll get to a safer and thriving Toronto.

Anna Willats, Toronto

Lest you think this is solely a Toronto problem, my observation over the years is that city councils  traditionally rubber-stamp increases requested by police services board. You can be certain that if this practice changes, you will hear even more fear-mongering from forces across the country.