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Private Members' Business

Canada Revenue Agency Act

2026-05-28 Sitting 124 Showing 1–3 of 3

A bill to require the Canada Revenue Agency to report on how much tax money it fails to collect. The bill also requires the CRA to list all convictions for tax evasion. Members talked about the need for more transparency and accountability, and whether there were privacy concerns with the bill. Most seemed to support the bill.

Official Hansard ↗

Hon. Kevin Lamoureux

Liberal 5:30 p.m.

“I'm trying to change the subject to privacy concerns. Maybe that will distract from the actual bill about reporting unpaid income tax.”

Hon. Kevin Lamoureux

Liberal 5:35 p.m.

“I'm filling time with kind words about the Prime Minister. I think a stronger Canada can help America. Conservatives are conceding on our arts industry. The budget has measures for tax fairness, but Conservatives are voting against it. This bill could make a positive difference. The CRA is doing a good job. We should pass this bill and consider amendments in committee. Thanks to Senator Percy Downe for his work on this.”

Official Hansard

Mr. Speaker, I want to start off with what my colleague across the way started his comments with. He made reference to the Prime Minister's going down to the United States. I think that a vast majority of Canadians see that we have a Prime Minister today who is in this for the long haul. He recognizes the importance of international trade and relationships. He was not only meeting with the President of the United States; in my understanding, the luncheon that the member across the way referred to was with 200 of the United States' top business people, individuals who control hundreds of millions, going into billions, of dollars. In that speech, the Prime Minister did not just say, “We are just going to make America strong.” He prefaced it with some very important words. He indicated to this group that a stronger, more independent Canada, in a selective way, could help make America great again. Now, at the end of the day, does the member disagree with the idea that a healthier and stronger Canada would contribute to a healthier and stronger United States? That is what a trade agreement is all about, and the actions that this Prime Minister and this government have taken to date reinforce that. We just went through a full day of debate on a Conservative motion in which the Conservatives are capitulating on our arts industry. They are saying that we can no longer defend the arts community; rather, we should just concede it. It is important to recognize that, when we talk about the issue of tax fairness, we have to factor in that we are in the midst of negotiations. The member himself talked about the importance of having a stronger and healthier economy. Part of that means having a tax system that is fair, that has transparency and that has accountability. In budget 2025, members will see a number of measures that would allow for more tax fairness. There are a number of proposed changes to ensure that we are moving forward regarding the issue of tax fairness. It is interesting that my Conservative friends are voting against that, or at least they are voting against the budget. However, I have some good news. Bill S-217 has been a very important issue for the Senate, particularly Senator Percy Downe. It has been an issue for him for many years. I believe it has been over 10 years that he has been working on this particular issue that we have before us today. We have a government that recognizes a number of principles within the legislation that could, in fact, make a positive difference. Therefore, when we look at the legislation, we see a number of actions that are being taken. We can talk about the convictions, that all convictions for tax evasions, including international tax evasions, would be listed and produced in the annual report from Canada Revenue Agency to the minister. There is a great deal of merit in that. We also recognize the issue of the tax gap. It is important that we all recognize what the tax gap is. One of the answers the member gave was interesting. My understanding of the tax gap is, in theory, if everyone paid their taxes, there is a total amount that the government would have a very good sense of. In reality, we are not going to achieve that total. I think it is fair to say that a vast majority of taxpayers pay their fair share of taxes in a timely fashion. We all know that CRA has a process to encourage people who have not paid their taxes in a timely fashion to do so. There is some merit in dealing with that issue in whatever way we can. What I liked about his comments, because I think the member was right, was when he talked about the civil servants, or our CRA employees. They are doing an outstanding job for all Canadians. They have been called upon at different times, whether it was during the pandemic or for new programs outside of the pandemic, to step up to the plate. They have done that. This is where I disagree with the member for Simcoe North. I believe that the CRA needs to be able to continue to support Canadians in different ways at times. I think of, for example, the disability program the government introduced just a couple of years ago, finally recognizing the importance of disabilities. I think of the tax breaks that would have been given during the pandemic, and ultimately payments that were very much relied on in terms of how much people were making. The CRA is the natural spot to go to. The employees, as I have indicated, have done an absolutely outstanding job administering the services Canadians need. We all believe, I would like to think, that taxation is an important public policy. It is what gives us the opportunity to provide the type of social programming we are able to do. As I indicated, a vast majority of individuals and businesses pay their taxes in a timely fashion. At the end of the day, the CRA does go after those who do not. Like Senator Downe, I too am concerned about the tax gap. However, I do believe, in looking at the legislation and in listening to the member who took up Senator Downe's cause, that this ultimately does need to go to committee. There is a great deal of merit to see this legislation pass second reading, with the idea that we would be able to get some amendments brought forward and allow for input from different stakeholders on the issue. It is not the first time we have the government recognizing the merit of legislation in private members' business. As long as there is a willingness to look at amendments that would give it strength, deal with issues such as privacy and ensure we would not be diminishing anything that the CRA or the minister are currently doing, I think the legislation is a great opportunity. I would like to thank Senator Percy Downe for the work that he has done to date, ultimately making sure that we have the legislation before us.

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Dominique O'Rourke

Liberal 5:55 p.m.

“I think the CRA is already doing a good job. They have a lot of investigations and people are being sentenced to prison for tax evasion. The CRA already publishes convictions and gives information to the Parliamentary Budget Officer. The tax gap is not a perfect measure, but it helps us understand the health of our tax system. The CRA's actions are reducing the tax gap. This bill wants more reporting, but the CRA is already doing a lot and people can access the information.”

Official Hansard

Mr. Speaker, I am pleased to have this opportunity to discuss Bill S-217, an act to amend the Canada Revenue Agency Act with regard to reporting on unpaid income tax. This bill would amend the Canada Revenue Agency Act to require the CRA to list all convictions for tax evasion, including international tax evasion, in its annual report. The bill also requires the CRA to include statistics on the tax gap in its annual report once every three years. Additionally, Bill S-217 specifies that the Minister of National Revenue is to provide the Parliamentary Budget Officer with data on the tax gap. Broadly defined, the tax gap is the difference between the taxes that would be paid if all obligations were fully met in all instances, and taxes that are actually paid and collected. It is not difficult to imagine that a lot of circumstances could produce a tax gap. That said, I should point out that the CRA is firmly committed to protecting the integrity and fairness of Canada's tax system. This includes cracking down on tax avoidance and tax evasion both domestically and internationally. I should also mention that CRA takes a firm stand on non-compliance. First, I would like to point out that the CRA has a robust criminal investigations program. This program investigates major cases of tax evasion, tax fraud and other serious criminal violations of tax laws. Where appropriate, the CRA's criminal investigations program refers cases to the Public Prosecution Service of Canada for potential criminal prosecution, which is extremely serious. The consequences for taxpayers who commit tax fraud or hide assets or money abroad are very serious. If convicted of tax evasion, these taxpayers must still pay the full amount of tax owed, plus interest and administrative penalties imposed by the CRA. Under the Income Tax Act, offenders could face a fine of up to 200% of the taxes evaded. In addition, they could also be sentenced to up to five years in prison. It should also be noted that a person convicted of fraud under the Criminal Code is liable in Canada to a sentence of up to 14 years in prison. Fingerprinting and restrictions on international travel are also possible consequences. However, it should be noted that all convictions related to tax evasion, including those involving tax evasion abroad, are already published via enforcement notices on the Canada.ca website. The CRA has also set up a free subscription service to raise Canadian taxpayers' awareness of CRA enforcement actions and warn them about potential fraud schemes. During the period from April 1, 2020, to March 31, 2025, the courts sentenced 49 people to prison for a total of more than 98 years. Investigations are under way, prosecutions are under way, action is being taken and people are being sentenced. That represents more than $39 million in evaded federal taxes, with a total of $24.5 million in court-imposed fines. As of March 31, 2025, the criminal investigations program, or CIP, had 200 ongoing investigations. That is a huge number of investigations. Between April 1, 2024, and March 31, 2025, the CIP also executed 86 search warrants, a 46% increase from the previous fiscal year. The CIP's computer forensics analysts seized at least 258 devices totalling more than 119 terabytes of data. I would now like to bring up a second point, namely the CRA's work on estimating Canada's tax gap. Since 2016, the CRA has had a dedicated team studying the tax gap, which supports the Government of Canada's commitment to encouraging an open and transparent discussion on tax non-compliance. Estimates of Canada's tax gap, combined with other indicators relating to compliance and non-compliance, can provide valuable insights into the overall health of our tax system. At the end of March, the CRA published Canada's second overall tax gap report for the 2014 to 2022 tax years. This edition presents the overall federal tax gap and is supported by updated estimates based on the most recent data available for the 2014 to 2022 tax years. The report provides tax gap estimates for all key components. These include personal income tax, corporate income tax, GST, HST and excise revenue. The report also includes two new subcomponents: the payment payroll gap and the excise gap on cannabis. Furthermore, it examines the impact of the COVID-19 pandemic on the federal tax gap, providing an overall picture. Importantly, this report also highlights how the CRA's compliance and collection activities are impacting the tax gap. The money recovered by the CRA puts downward pressure on the federal tax gap each year. We have the numbers in front of us, and we can compare the gross and net amounts. In tax year 2022, the gross tax gap was 16% of the federal tax revenue or $59.5 billion. However, the net tax gap would have been 9.3% of the federal tax revenue or $34.7 billion, so the CRA's compliance and collection activities resulted in a potential reduction of the overall gross tax gap by 42%, or $24.8 billion. That said, I would like to mention that the data on Canada's tax gap is also published on the Government of Canada's open data portal and is widely available. That means that this information can be accessed by the Canadian public and interested parties, such as the Parliamentary Budget Officer. Canadians can rest assured that the Government of Canada and the CRA remain committed to supporting the Parliamentary Budget Officer in carrying out her mandate. This commitment is being fulfilled with the assurance that Canadians' confidential tax information is protected in accordance with the law. I would like to take this opportunity to recognize the recent appointment of Annette Ryan as the Parliamentary Budget Officer. In conclusion, the work on the tax gap provides us with a clearer picture of the health of Canada's tax system. This work encourages an open and transparent discussion on tax non-compliance. That said, it is important to note that many factors remain beyond the control of any tax administration when estimating the tax gap. Moreover, there is an international consensus that a country's tax gap will likely never reach zero. Furthermore, it is important to note that the tax gap is not a performance indicator for either the CRA or the government. It is a theoretical estimate of non-compliance with tax obligations over a given period, and this non-compliance can vary over time. As a result, the tax gap is primarily an important source of information to monitor what is happening in our tax system. One thing is certain: These efforts to address the tax gap are aimed at ensuring that everyone, individuals and corporations alike, meets their tax obligations, because taxes not only fund government services and programs, but also promote economic development in Canada through investments in the many sectors of our economy.

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