CRA says Saskatchewan uranium giant Cameco has avoided paying hundreds of millions in Canadian taxes by offshoring profits in Switzerland – by John Greenwood (National Post – September 26, 2013)

The National Post is Canada’s second largest national paper.

The Canada Revenue Agency says Saskatchewan-based Cameco Corp. hasn’t been paying its taxes and it wants the money. Now Saskatchewan premier Brad Wall has joined the fray, calling for Cameco, the world’s largest publicly traded uranium producer, to pay up.

Speaking to reporters this week, Mr. Wall said part of the tax revenue that Ottawa collects ends up going back to the provinces, so when the CRA says it’s not getting what it believes it should, “that’s a concern to [Saskatchewan] as well, and it should be. It doesn’t matter who the company is, or the individual. We should pay taxes that are due.”

At issue is Cameco’s alleged practice of shifting profits to a Switzerland subsidiary where taxes are lower. And while the Cameco case has been going on for several years and though the CRA won the most recent round, the ruling is being appealed and observers say it is unclear who will come out on top.

“The CRA has had a lot of trouble proving some of these cases in court,” said Dennis Howlett, executive director of Canadians for Tax Fairness.

Observers say the practice of transfer pricing as a way to lower tax rates is widespread across corporate Canada, engaged in by many of the biggest and best known players across a swath of industries.

In Ottawa, the Minister of National Revenue is responsible for the CRA.

A spokesman for Revenue Minister Kerry-Lynne Findlay said in an emailed statement on Wednesday evening that Ms. Findlay “expects all taxpayers to respect the rules and pay their fair share. Abusive transfer pricing schemes are a very serious issue and this government’s record speaks for itself. Since 2006, CRA has made nearly $4.6B in transfer pricing adjustments.”

It’s not just Canada that is struggling with the problem. According to Mr. Howlett, what amounts to the transfer of profits to low tax jurisdictions is an issue across much of the developed world.

For the rest of this article, click here: http://business.financialpost.com/2013/09/25/cameco-cra-tax/

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