Offshore Compliance Advisory Committee – Minutes – June 15, 2016

Wednesday, June 15, 2016
Inaugural Meeting

List of Participants

OCAC Members

Colin Campbell

Kimberley Brooks

Committee Members

  • Marie-Pierre Allard
  • Catherine Brown
  • Larry Chapman
  • Allan Lanthier
  • Daniel Thornton

CRA Attendees

Minister of National Revenue
The Honourable Diane Lebouthillier

Assistant Commissioner, International, Large Business and Investigations Branch
Ted Gallivan

Deputy Assistant Commissioner, International, Large Business and Investigations Branch
Lisa Anawati

Director, Horizontal Programs Division
Joanne Heidgerken

Manager, Voluntary Disclosures Program
Kevin Morgan

Director General, Criminal Investigations Directorate
Johanne Charbonneau

Director, Criminal Investigations Division
Stephane Bonin

Acting Director General, International and Large Business Directorate
Jennifer Ryan

Director, Offshore Compliance Division
Gina Jelmini

Special Advisor, International, Large Business and Investigations Branch
Maria Pagliarello

Special Advisor, International, Large Business and Investigations Branch
Alexandra MacLean

Senior Technical Advisor, International and Large Business Directorate
Maureen O'Leary

1. Opening Remarks

The Minister welcomed all members to the inaugural in-person meeting of the Offshore Compliance Advisory Committee (OCAC). She noted that the establishment of the OCAC is a major development in the Government's overall strategy to combat non-compliance. The CRA can benefit from outside experts who bring an objective but informed perspective to complex issues.

The Minister reiterated that the objective of the OCAC is to provide her and senior CRA officials with advice on the most effective strategies to combat offshore tax evasion and tax avoidance. In examining the issues, the Minister asked that members consider:

  • the guiding principles and practices that CRA should put in place to not only administer the tax system effectively and fairly but to do so in a transparent way to ensure public confidence; and
  • how the CRA should evolve its approach and use available compliance tools to deter offshore non-compliance.

Regarding the topics for discussion at the meeting, the Minister provided members with the following questions to help stimulate discussions and provide a focus for deliberations:

  • What are the key principles and objectives for a Voluntary Disclosures Program?
  • If the ultimate goal is to promote voluntary compliance, what is the right balance between the rewards for full compliance, the consequences of participating in the Voluntary Disclosures Program, and the consequences of serious non-compliance?
  • Are there changes that could be made to the criminal investigations process to better detect and discourage tax evasion, and help demonstrate to Canadians that everyone must play by the rules?

The Minister noted that there are other topics, including the appropriate mix of compliance measures to target offshore non-compliance, for the OCAC to consider as time permits during its mandate.

In closing, the Minister thanked all members for their participation.

The Chair then welcomed all members to the meeting and looked forward to the CRA presentations and beginning the OCAC's discussions.

2. Terms of Reference

The terms of reference were approved by a majority vote of the OCAC members.

3. Update on the International, Large Business and Investigations Branch

Ted Gallivan outlined that the branch is focused on not only detecting and auditing non-compliance but how the overall regime brings people into compliance and ensures a level playing field. Mr. Gallivan emphasized that having outside, independent voices will help the CRA achieve progress and indicated that the CRA is open to questions and bringing in internal experts so that the committee can examine and understand program fundamentals.

There were questions and discussion from the members on the overall objectives of the CRA, and the various types of non-compliance driving the approaches adopted.

CRA officials indicated that they understood that CRA's compliance actions would impact both the taxpayer of interest and the broader taxpayer base that would be influenced by its perception of the treatment.

4. Voluntary Disclosures Program

Joanne Heidgerken gave a presentation on the Voluntary Disclosures Program (VDP), following which the committee members had the opportunity to ask questions. The members then began their discussion about various aspects of the program, such as;

  • In light of the downward trend in interest rates, should CRA review the amount of interest relief eligible under VDP?
  • Because the CRA has access, or will gain access, to unprecedented levels of international transaction data, Should CRA consider a staged VDP approach for international non-compliance?
  • Whether the VDP should be limited to certain types of disclosures, and/or whether the relief should be the same depending on the type of non-compliance.
  • Are taxpayers using the VDP to deal with filing oversights which would more properly be dealt with under Taxpayer Relief?
  • Should practitioners be able to meet with a CRA official to discuss a disclosure?
  • How should CRA deal with the perception that some taxpayers may be getting a better deal if they choose not to comply? Is that perception valid?

5. Criminal Investigations Program

Johanne Charbonneau gave a presentation on the Criminal Investigations Program, following which the committee members had the opportunity to ask questions.

There was discussion about the need to enhance communications about what the program is doing and place results, and conviction numbers in particular, in context vis-à-vis other jurisdictions.

Generally, there was support for the program's focus on promoters with the trickle effect to audit for participants.

6. Forward Agenda

It was suggested that the next in-person meeting be held in September to discuss the development of recommendations for the VDP, for the CRA to consider.

Members discussed potential future topics:

  • The CRA's use of big data
  • Audit/settlement agreements

The Chair thanked everyone for their participation and adjourned the meeting.

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