5 reasons Canada lags on tax-haven crackdown

When eight of the world's wealthiest countries gather on Monday for their annual forum, the meeting will focus on offshore tax havens, an area in which Canada has not taken a lead role.

Offshore tax cheats to be central focus of G8 meeting

British Prime Minister David Cameron is facing pressure at home to crack down on offshore tax havens. A U.K. media report suggests Canadian Prime Minister Stephen Harper has been resisting parts of the international plan. (Leon Neal/Associated Press)

When eight of the world's wealthiest countries gather on Monday for their annual forum, this time in Northern Ireland, the meeting will focus on, among other things, offshore tax havens. 

The G8 summit on Monday and Tuesday comes nearly two months after what is believed to be the largest ever leak of data from offshore tax havens, most of it from the Caribbean and South Pacific. CBC News was part of the International Consortium of Investigative Journalists group that was given access to the data from 10 locales, involving 130,000 people.

U.K. Prime Minister David Cameron, who currently chairs the G8, has come under increased political pressure at home to target these secretive offshore accounts and has made tax compliance a key focus of this year's gathering.

Cameron is seeking an international agreement that would require countries to reveal the true beneficial owners of shell companies and trusts, a measure necessary to ensure tax-information exchanges work.

But Prime Minister Stephen Harper has been resisting parts of the plan, according to a report this weekend in the British press.

Here's a look five recent CBC News stories that show how Canada has fared when it comes to dealing with offshore tax havens and tax cheats.

Canada playing catch-up on global tax probe

The big media leak on offshore tax havens came in April. But in May it was revealed that a few countries had been quietly sifting through the trove of records for more than a year.

In that time, the Australian Tax Office, for instance, had already launched two criminal tax-evasion investigations, started 35 audits and red-flagged 65 people. Australia is part of a three-country joint investigation, along with Britain and the U.S. Canada wasn't part of the probe. It requested the leaked files shortly after the media reports in April, forcing the country to play catch-up.

'Offshore' tax cheat conviction list questioned

A recent CBC analysis of the Canada Revenue Agency's "Offshore Convictions" list revealed that only a third of the cases  seemed to involve someone hiding assets in an accepted tax-haven jurisdiction, meaning one that is "a jurisdiction with no taxes or a very low rate of tax, a lack of transparency in the operation of its tax system, and a lack of effective exchange of information with other countries," according to the CRA's own website.

International tax expert David Chodikoff noted the prosecutions touted by the government "don't smack of great success in my estimation." He also questioned why there haven't been any convictions from two other big data leaks in 2007 and 2009, when a combined total of nearly 1,900 Canadian names were given to the CRA.

Government stalls effort to probe 'tax gap'

Former parliamentary budget officer Kevin Page sought to examine the country's tax gap — the amount of tax dollars lost to tax evasion each year. Page said he couldn't get the Canada Revenue Agency to release the data needed to make the calculation. 

The interim parliamentary budget officer, Sonia L'Heureux, has continued the fight. In May, she sent a letter to the revenue agency offering to compensate it for expenses related to preparing the required data or asking for the budget office to get direct access to it. Both the U.K. and the U.S. calculate these so-called tax gaps.

No rewards for tax cheat data dumps

The U.S. and Germany have forked over millions of dollars to gain access to massive data leaks revealing secret offshore accounts that have allowed wealthy individuals to siphon funds away from government tax coffers. However, Canada had, until the most recent federal budget, rejected that approach. Its refusal to pay rewards cost the country early access to the latest release of offshore haven data, the largest in recent history. Sources say the revenue agency was offered access to the records sometime before last December.

Cuts to Revenue Canada

The compliance section of Canada's revenue agency took a hit earlier this year, which could undermine the country's attempt to deal with offshore tax evaders, NDP critic Murray Rankin says.  

However, the federal government has introduced a series of measures in the past few months to tackle tax evasion. Among them are a new "SWAT team" of federal officials to probe Canadians with hidden offshore accounts, a reward system for those who blow the whistle on tax evaders and the establishment of a tip line.