Newfoundland business operator fined $604,993 for tax evasion

The Canada Revenue Agency (CRA) announced that on October 28, 2019, Gary Evans of Torbay, Newfoundland, operating as St. John's Aircraft Services, was sentenced to a conditional jail sentence of 12 months to be served in the community. Evans was fined $342,745 under the Income Tax Act and $262,248 under the Excise Tax Act for a total of $604,993. On November 29, 2018, Evans pleaded guilty in the Provincial Court of Newfoundland and Labrador in St. John's to five counts each of income tax evasion and goods and services tax / harmonized sales tax (GST/HST) evasion. In addition to the court imposed fine, Evans will have to pay the full amount of tax owing, plus related interest and any penalties assessed by the CRA.

A CRA investigation revealed that for the years 2009 to 2013, Evans failed to report net business income totaling $2,594,237, thereby evading federal income taxes totaling $685,490 and GST/HST totaling $349,665. During these years, he earned income and collected GST/HST as sole proprietor of St. John's Aircraft Services, providing de-icing services to aircraft out of St. John's, Newfoundland.

All case-specific information above was obtained from the court records.

Choosing not to follow Canada's tax laws can result in serious consequences. These consequences include: audit reassessments, civil penalties, criminal tax investigations and prosecutions resulting in possible court fines and/or jail time along with a criminal record. Under the income tax and excise tax laws, being convicted of tax evasion can include fines ranging from 50% to 200% of the evaded taxes and up to five years in jail. Being convicted of tax fraud under section 380 of the Criminal Code carries a sentence of up to 14 years in jail.

Those who do not fully comply with tax laws place an unfair burden on law-abiding taxpayers and businesses and jeopardize the integrity of Canada's tax base. While investigations take time, the CRA is committed to acting on all serious cases of non-compliance. From April 1, 2014, to March 31, 2019, the courts convicted 231 taxpayers for tax evasion of $111,297,091 in federal tax. These convictions resulted in sentences totaling $29,628,607 in court fines and 212 years in jail.

The CRA has set up a free subscription service to help Canadians stay current on the CRA's enforcement efforts.

- 30-

Contacts

Anne Pachal
Canada Revenue Agency
902-426-5784