Tackling the issue of tax avoidance and fairness
Tax havens have created an unsustainable economic structure wherein the rich get richer, Dennis Howlett summarized.
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“Inequality is probably the single most important cause of our economic stagnation, because there is so much money in the hands of rich people they can’t spend it,” he reasoned.
“Inequality is bad for our economy … and our government should be doing more with the tax system to redistribute wealth, but the current government is doing the opposite.”
The executive director of the Ottawa-based non-profit, non-partisan organization Canadians for Tax Fairness is scheduled to speak in Prince Albert on Wednesday as part of a Saskatchewan tour.
Concluding that Canada’s tax policies are concentrating wealth, Howlett has narrowed his focus on Cameco for this week’s tour of Saskatchewan — a Saskatoon-based company whose influence on the province’s economy is significant.
Currently before the courts, Canada Revenue Agency is seeking hundreds of millions of dollars from Cameco as a result of the corporation’s profit shifting through offshore tax havens.
“They end up paying a lot less taxes than they should be paying in a country like Canada, where they extract uranium,” Howlett said.
“We expect that they’re not the only case,” Howlett said. “In many, many cases, companies like this settle out of court. So, they pay something, but probably a lot lighter than they would otherwise … Cameco decided to fight it in court, and as a result we’re learning a lot more about it.”
Cameco declined comment for the purposes of this article, with manager of media relations Rob Gereghty limiting comment to the fact he’s “confident that we will be successful in our case.”
Cameco’s latest quarterly report addresses the Canada Revenue Agency’s dispute.
Canada Revenue Agency has issued a reassessment for $5.7 billion, resulting in a tax expense of $1.6 billion, drawing from finances that date back to 2003.
“Cameco has been so bold I don’t think they’ll get away with it, even under the current laws,” Howlett said.
Although Howlett remains critical of the current government’s tax policies, he gives former finance minister Jim Flaherty credit for getting the ball rolling in tightening up certain tax havens.
In the same breath, Howlett criticizes the feds’ recent income splitting model, wherein married couples with children under 18 can transfer up to $50,000 in taxable income from one spouse to another to take advantage of a lower personal tax rate.
Costing the federal government $2.4 billion a year in revenue, Howlett said that the program is primarily benefiting the top 10 per cent of Canadians.
“It’s not really fair and there are a lot better ways to support families and children than income splitting.”
Howlett’s presentation, titled “Pay Up Cameco! Hundreds of millions owed to Canadians,” will take place at the Prince Albert Union Centre at 7:30 p.m. on Wednesday.
The event is being sponsored by the Council of Canadians, Prince Albert and District Labour Council, CUPE 4777 and Renewable Power the Intelligent Choice.
