CBC Manx Allegations: OECD Pressed on Value of TIEA’s

NEWS FROM THE CELTIC LEAGUE

The Celtic League has pressed the OECD over the value of so called Tax Information Exchange Agreements (TIEAs) following allegations in Canadian Broadcasting Corporation news reports alleging tax evasion earlier this month news.

A TIEA is in place between the Isle of Man and Canada.

OECD letter text below:

“Pascal Saint-Amans
Director
Centre for Tax Policy Information
OECD

By email

28th September 2015

Dear Sir,

I draw your attention to the attached press report (video) produced by the Canadian Broadcasting Corporation and alleging tax evasion by a Canadian Citizen using a ‘tax plan’ arranged in Canada which utilizes the Isle of Man.

https://www.cbc.ca/news/thenational/kpmg-allegedly-involved-in-offshore-tax-sham-1.3237906

I understand that as a consequence of the single allegation reported in the CBC case the Canadian Revenue Agency has tried to get details of any other persons in Canada the Company in question may have provided this tax plan for. The Company is contesting the CRAs request and the matter is now before the Canadian Courts.

My question to OECD is quite straightforward;

Given the great value OECD place on, so called, Tax Information Exchange Agreements (TIEAs) why can a country (such as Canada), which becomes aware that a ‘tax plan’ involving its citizens and potentially impacting on its ‘National Tax Take’, not utilize a TIEA to request the relevant information from the country (in this instance the Isle of Man) in which the tax plan allegedly operates?

It strikes me that TIEAs which OECD eulogised in its 2009 document ‘Countering Offshore Tax Evasion’ is a fairly worthless instrument if such basic exchanges of information cannot be facilitated swiftly (link).

https://www.oecd.org/ctp/exchange-of-tax-information/42469606.pdf

I would point out that the damage caused by tax evasion allegations is not only counter-productive to the State (in this case Canada) which alleges lost revenue but also by the territory (in this case the Isle of Man) which is the subject of the allegations and thereby suffers reputational damage.

Legitimate and credible financial services business must be tarnished when the only medium for resolving issues over taxation is via the mass media.

I would point out that since the CBC allegations at least one large Trade Union in Canada (NUPGE) has registered its concerns over the situation (link).

https://nupge.ca/content/12489/kpmg-tax-avoidance-and-privatization-schemes-costly-public

I would have thought that the avoidance of these type of ‘taxation fracas’ is part of the raison d’être of the OECD and the purpose that TIEAs were meant to facilitate?

Yours sincerely

J B Moffatt (Mr)
Director of Information”

Related link on Celtic News;

https://www.celticleague.net/news/mann-treasury-respond-to-league-query-about-cbc-allegations/

BERNARD MOFFATT

Issued by: The Celtic News

28/09/15

THE CELTIC LEAGUE INFORMATION SERVICE

The Celtic League established in 1961 has branches in the six Celtic Countries. It promotes cooperation between the countries and campaigns on a range of political, cultural and environmental matters. It highlights human rights abuse, military activity and socio-economic issues

Baile


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