Toronto – Today, Finance Minister Morneau announced the Federal Government’s call for consultation on ‘Tax Planning Using Private Corporations’. This consultation follows Minister Morneau’s recent public statement that recognizes that anonymous beneficial ownership of corporations are harming Canada by allowing the flow of dirty money domestically and from overseas.
While Transparency International Canada (TI Canada) welcomes these acknowledgements, including Minister Morneau’s emphasis that provincial leaders must also take leadership in their jurisdictions on beneficial ownership, we urge the Minister to urgently address this issue with concrete examples that were absent today.
As the Department of Finance formulates its plans to address beneficial ownership, TI Canada once again urges that Canada employ a public registry of beneficial ownership information as a key tool to protect Canadians and Canada’s economy.
Canada is obliged to establish a registry of beneficial owners based on our 2014 G20 commitments. A registry improves financial institutions’ and business’s ability to conduct due diligence on customers and follow Canadian anti-money laundering and terrorist financing regulations. A registry also provides law enforcement and tax authorities with better access to information to conduct investigations.
A public registry will allow greater scrutiny by Canadian civil society and media, and create a greater deterrence for those seeking to use the Canadian financial system to ‘snow wash’ their dirty money. A public registry, like in the United Kingdom, Denmark, Slovenia, and the Ukraine, would reduce corruption and improve the functioning of high-risk sectors such as real estate, public procurement, and lobbying. It would enhance Canada’s reputation both internationally and at home, and improve public trust in government.
Non-public means of sharing beneficial ownership information require costly and laborious information sharing that slow criminal investigations and hinder efforts to crack down on tax evaders, money launderers and terrorist financiers, inhibit public accountability, and exclude certain actors, such as securities commissions, from accessing vital information.
TI Canada is making this case to provincial leaders as well while they meet in Edmonton. TI Canada joined civil society partners at Canadians for Tax Fairness, Publish What You Pay Canada, and the Canadian Labour Congress in sending a letter to the First Ministers emphasising their obligation to tackle the problem of beneficial ownership in their jurisdiction.
TI Canada welcomes comments from Minister Morneau’s staff in the Toronto Star today, that Finance Canada is open to a registry of beneficial ownership being public. TI Canada will be there making the case on why the Government should follow the public path.
James Cohen
Interim-Executive Director
For media inquiries, please contact ti-can@transparencycanada.ca or 416-488-3939