TEI Submits Comments on Proposed Changes to the Canada Revenue Agency's Voluntary Disclosures Program.

• Position: Tax Executives Institute

On behalf of Tax Executives Institute, Inc. ("TEI"), I am pleased to comment on the proposed changes to the Canada Revenue Agency's ("CRA") Voluntary Disclosures Program ("VDP") outlined in Draft Information Circular--1COO-1R6--Voluntary Disclosures Program ("Draft Circular") and Draft GST/HST Memorandum 16.5--Voluntary Disclosures Program ("Draft Memorandum").

The Draft Circular and Draft Memorandum substantially limit the relief available to sophisticated taxpayers under the income tax VDP and GST/HST VDP, respectively. Moreover, the Draft Circular excludes corporations with gross revenues in excess of $250 million from the income tax VDP altogether. These changes, as well as general confusion regarding application of provisions in the Draft Circular and Draft Memorandum, undermine the CRA's goal of providing fair relief while not appearing to reward noncompliance. TEI welcomes the opportunity to meet with the CRA to discuss these concerns before the Draft Circular and Draft Memorandum are finalized.

About Tax Executives Institute

TEI was founded in 1944 to serve the professional needs of in-house tax professionals. Today, the organization has 56 chapters in North and South America, Europe, and Asia, including four chapters in Canada. Our approximately 7,000 members represent 2,800 of the largest companies in the world, many of which either are resident or do business in Canada.

Canadians constitute nearly 15 percent of TEI's membership, with our Canadian members belonging to chapters in Calgary, Montreal, Toronto, and Vancouver. TEI members must contend daily with the planning and compliance aspects of Canada's business tax laws. Many of our non-Canadian members (including those in Europe and Asia) work for companies with substantial activities and investments in Canada. These comments reflect the views of TEI as a whole but, more particularly, those of our Canadian constituency.

As the preeminent association of business tax professionals worldwide, TEI has a significant interest in encouraging the uniform and equitable enforcement of tax laws, and reducing the cost and burden of tax administration and compliance to the benefit of taxpayers and government. TEI is committed to maintaining a system that works--one that builds upon the principle of voluntary compliance, is consistent with sound tax policy, is easy to administer, and is efficient. The diversity, professional training, and global viewpoint of our members enable us to bring a balanced and practical perspective to the issues raised by the draft guidance discussed herein.

Comments on the Draft Circular and Draft Memorandum

1. Summary of the Proposed Changes to the VDP

   1. The Income Tax VDP

      The Draft Circular establishes two tracks for income tax disclosures: a General Program and a...