“Companies like Google should be the subject of a leaders’ debate not sponsoring them." — Dennis Howlett, executive director of Canadians for Tax Fairness
Ottawa (16 Sept. 2015) — A Canadian tax watchdog says it is a conflict of interest for one of the world’s biggest tax avoiders to be sponsoring a federal leaders’ debate on the economy.
Google sends billions offshore to avoid taxes in Canada
Canadians for Tax Fairness says that corporate tax avoidance is a multi-billion dollar drain on Canada’s economy. It is concerned that the issue won’t get the attention it deserves at the debate because of Google’s involvement.
“Companies like Google should be the subject of a leaders’ debate not sponsoring them,” says Dennis Howlett, executive director of Canadians for Tax Fairness. “Canadians know that billions are funneled out of our economy each year to places like the Cayman Islands, Bermuda and Switzerland by corporations looking to pay little or no tax.”
Google CEO "proud" of sidestepping billions in taxes
Globally, Google has circumvented tens of billions in taxes by virtually pipelining its profits to Bermuda. Canada’s corporate tax rate is officially about 26 per cent (federal and provincial combined). It is the lowest in the G7. With aggressive tax practices, Google has an effective tax rate of 2.7 per cent in its international division.
Google maintains what they are doing is legal and within the tax laws of the countries in which it operates. In 2012, Google CEO Eric Schmidt said he was "proud" of the way his company had sidestepped billions in taxes by profit shifting. But Howlett says, “This debate is the time to ask our leaders what they plan to do to stop that kind of corporate behaviour."
There is at least $199 billion in Canadian corporate money sitting in tax havens.
Federal leaders need to go on record about tax evasion and corporate taxes during debate
Howlett offers three questions to put to leaders on the tax avoidance issue:
- At 26 per cent, Canada’s corporate rate is the lowest in the G7. Many large corporations pay effective rates of less than 10 per cent. Yet lowering corporate tax rates has not boosted investment or job creation — just reduced revenue. What would you do about corporate taxes?
- The Parliamentary Budget Office has asked the Canada Revenue Agency to turn over non-confidential data to enable it to complete a Tax Gap report on the difference between what Revenue Canada is owed and what it actually receives. It is a methodology used by several OECD countries to identify problem areas and target revenue collection efforts more effectively. What is your plan to make this happen?
- What measures would you take to bring Canada Revenue Agency expertise up to standards where it can track, report and prosecute offshore tax evaders?
Canadians for Tax Fairness is a national, non-partisan organization working for fair tax policies and practices.
New government needs to tackle issue of missing corporate revenue
The National Union of Public and General Employees (NUPGE) is a strong supporter of Canadians for Tax Fairness.
"Throughout this campaign, I encourage people to question candidates about their position, and their party's position on tax avoidance," says James Clancy, NUPGE National President. "Canada is losing billions in corporate tax revenue each year while hard working Canadians are dutifully contributing their share. We need a government that will take action on stemming this massive leak in our system."
The National Union of Public and General Employees (NUPGE) is one of Canada's largest labour organizations with over 360,000 members. Our mission is to improve the lives of working families and to build a stronger Canada by ensuring our common wealth is used for the common good. NUPGE