Quote:
Originally Posted by blankall
Theoretically, there could be workarounds:
1. Crackdown on offshore holdings specifically.
2. Make penalties relative to the extent of the offence. If you get caught not reporting $1,000 in under the table work, the penalty is different than if you get caught hiding $1,000,000 in revenue. There's already precedents for this in the criminal law. For example drug and theft charges fall into different categories based on the amounts involved.
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I believe these already exist in some form. The major issue is being able to enforce these rules in a foreign jurisdiction.
On Canadian soil, the CRA can legally garnish money from you and freeze certain assets on Canadian soil to enforce payment. But in foreign jurisdictions even with a tax treaty in place, I do not believe that is possible.
But I think that's what we see. Someone like Edwards, cash value would be garnished from his Canadian companies/certain types of freezes would occur until they are paid up. So he won't risk those types of things. Someone like Villeneuve though, there isn't really any liquid assets on Canadian soil that I am aware of they can use in the enforcement.
Keep also in mind that in certain transacting scenarios, if a certain amount of cash is sent to the foreign individual before filing taxes (ie: no withholding tax), then individuals responsible for the transaction and transfer of cash out of Canada become liable for those unpaid taxes.
We already have variations of these rule which should work in theory, but as I mentioned to Mathgod, the fact there are many countries that do not cooperate and all have their own unique rules, is why many ultra rich can find ways to squirrel assets to tax havens and give us/other countries the middle finger salute when they try to collect.