The report below, from Canadians for Tax Fairness documents citizen pressure, little mentioned in the media report (Oct 26).
2018-10-26 CRA files appeal in multibillion-dollar tax case against Cameco, Saskatoon Star Phoenix
Last month (Sept, 21018), Cameco says the Tax Court ruled in its favour in the case which centred around its use of a subsidiary in Switzerland to sell and trade its uranium.
The CRA contended it was a sham established to avoid Canadian taxes, while Cameco maintained it was for legal and sound business practices.
2017-08-17 Cameco wins PROCEDURAL victory, offshore ‘transfer pricing’ tax battle (avoided declaring $4.9 billion income), (doesn’t mean they’ve won the case) Financial Post
|from Canadians for Tax Fairnes:
Just a few days ago we asked you to urge the federal government to appeal a Tax Court of Canada ruling that would have allowed Cameco Corp, the largest publicly traded uranium company in the world, off the hook for billions in unpaid corporate taxes to the federal and Saskatchewan governments. (INSERT: the appeal is APPENDED)
Hundreds of you responded immediately with emails to the federal Justice and Revenue Ministers – and thousands more responded with a parallel campaign we coordinated with Lead Now.
I’m very happy to report that thanks to your support on this, we’ve succeeded!!
We just heard today that the Canada Revenue Agency is appealing this misguided decision. It would have set a significant precedent and opened the floodgates to even more tax dodging by other multinational corporations.
Ultimately, we need stronger Canadian legislation and international rules to prevent this and other types of tax dodging by multinational corporations, but that will take many years to achieve. While we’re fighting for that, we need to keep the pressure on governments to take on these blatant abuses.
Thank you again for your support!
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From: Canadians for Tax Fairness
Sent: October 25, 2018
To: Sandra Finley
Subject: Appeal Cameco Tax Ruling
Please take a moment to tell the federal government to appeal a federal Tax Court decision that would let Cameco off the hook for paying $2.2 billion in back taxes to the Canadian government.
This is a very important case that will establish a precedent on corporations use of transfer pricing. If it’s not appealed, it could open the floodgates for other multinational corporations to also avoid paying corporate taxes through similar shams—and the federal government only has until Friday October 26 to give notice that they’ll appeal this misguided decision!
Saskatchewan-based Cameco Corp is the world’s largest publicly traded uranium company. It was formed when two previous publicly-owned crown corporations were privatized 30 years ago. Two decades ago they established a subsidiary in the tax haven of Zug, Switzerland to shift their profits there and avoid Canadian taxes. By selling their uranium at an artificially low price to this Swiss subsidiary, which then resells it at much higher prices, they’ve been able to report no profits in Canada while registering $8.4 billion in profits for their Swiss subsidiary, which then transfers these profits to subsidiaries in other tax havens.
Through this tax scam, they haven’t paid a cent in Canadian corporate taxes in years, while they’ve paid out billions in dividends to shareholders, pay their CEO $6 million annually, and yet just laid off hundreds of workers in Saskatchewan. Meanwhile the federal government is spending $1.3 billion to clean up the radioactive mess left in Port Hope by Eldorado nuclear, one of Cameco’s predecessor companies.
Tax lawyers and corporations are looking at this case intently to see if they can engineer similar deals to also avoid paying taxes. The $2.2 billion in taxes avoided by Cameco work out to about $150 per Canadian household.
Allan Lanthier, former chair of the Canadian Tax Foundation, recently wrote about this case in the Globe and Mail, concluding “So, do large Canadian corporations avoid billions of dollars of taxes each year? You bet they do. And other taxpayers – you and I – have to ante up the shortfall.”
Please take a moment to send an urgent message to the federal government to tell them to appeal this misguided decision!