Tax cheats: What Canada is missing out on thanks to offshore banking

Affordable childcare is a major concern for many Canadians families. BCFED

The Bahamas Leaks, released Wednesday, reveal a new trove of details on Canadian offshore holdings.

While it’s hard to pin down how much is lost to offshore dealings every year, tax maneuvers  — from illegal tax evasion to the grey area of offshore accounts —  rob Canadian tax coffers of an estimated $7.8 billion a year, according to the Canadians for Tax Fairness.

“It does result in a loss of tax revenue for Canada, and for provincial government as well,” said Dennis Howlett, the group’s executive director.

The feds pulled in $39.4 billion in corporate tax in the 2014-2015 fiscal year, and $135.7 billion in personal income tax; all revenues combined the feds had $282.3 billion to work with.

Story continues below advertisement

READ MORE: Federal budget 2016: Liberal government projects $29.4B deficit

Considering the Liberal government projects running in the red for at least the next four years, there’s no doubt that lost revenue could go a long way.

“The government has made a lot of promises they won’t be able to keep unless they find new revenue,” said Howlett.

“Going after tax havens is one good way without having to raise taxes on everybody.”

Here’s a look at what $7.8 billion could do for Canada.

National childcare strategy

Many Canadians struggle to find affordable daycare. Ian Barrett/The Canadian Press

Finding affordable childcare is pretty much impossible for many Canadian families. Costs for a toddler range, on average, from $451 per month in Winnipeg to more than $1,300 in Ottawa. Quebec has subsidized daycare and parents pay between $7.55 and $20.70 per day.

Story continues below advertisement

During the 2015 federal election campaign, NDP Leader Tom Mulcair pledged to create one million childcare spaces that would cost maximum $15 a day, from coast to coast. The plan would have taken years to implement, and big bucks. It was projected to take a full, four-year term to create about a third (370,000) of the spaces, at a cost of $1.86 billion.

WATCH: Mulcair pledges to create a million daycare spaces for no more than $15 dollars a day 

Mulcair said it would cost $5 billion to create enough affordable childcare spaces for all Canadians.

**Note: Quebec spends $2.2 billion a year to keep its childcare program going.

Affordable housing

Advocates say billions of dollars are needed to help an estimated 200,000 Canadians out of homelessness. File / Global News

While many Canadians work hard to achieve the white-picket fence dream, many more simply want a roof over their heads. More than 200,00 Canadians struggle with homelessness.

Story continues below advertisement

Anti-poverty advocates previously asked the government for $3.2 billion to renovate old units and build 100,000 housing units to help Canada’s homeless.

In the 2016 federal budget Ottawa set aside $2.3 billion over two years for affordable housing, leaving more work to be done.

Healthcare gaps

Canada’s healthcare system is going to need massive cash infusions over the next few decades. File / Global News

While commonly referred to as “free” healthcare, we all know too well (just look at your paycheque) it’s not free at all.

READ MORE: 3.4 million Canadians had unmet health care needs in 2014: report

Canada is unique among countries with universal healthcare as it does not include a national pharmacare program.

Out-of-pocket healthcare expenses such as prescription drugs can be a major barrier for some. It’s estimated universal drug coverage would cost Canada about $1 billion a year, according to a study published in the the CMAJ medical journal.


Sponsored content