The Canada Revenue Agency's confidential tip line has proven to be a powerful weapon against tax evasion, recovering approximately $490 million in unpaid federal taxes and penalties since 2018 according to newly released figures.
How the Offshore Tax Informant Program Works
Established by the federal cabinet in 2014, the Offshore Tax Informant Program encourages Canadians to report suspected international tax evasion and avoidance. The program processes an average of 109 credible tips annually, leading to the identification of nearly 950 taxpayers for audit since 2018.
Informants can receive payments ranging from 5% to 15% of recovered taxes, but only after all taxes have been collected and all appeal rights have been exhausted by the taxpayer involved. The CRA maintains strict confidentiality about payment amounts and the number of informants compensated.
Conservative MP Uncovers Program Results
The significant financial recovery figures came to light through an Inquiry of Ministry tabled in the House of Commons, requested by Conservative MP Eric Lefebvre. The data revealed that the program has been instrumental in the agency's efforts to combat international tax evasion.
Despite the program's success, internal CRA research indicates that most Canadians remain reluctant to become informants, typically viewing other people's tax planning as "none of their business."
Confidential Payments and Program Security
Ted Cook, then-senior tax legislation chief with CRA, testified during 2014 Senate national finance committee hearings that payments to informants are carefully managed to protect their identities and ensure program integrity.
The CRA emphasized that confidential tips remain "a key part of the Agency's efforts to fight international tax evasion and tax avoidance." The agency continues to protect the identities of informants while recovering significant revenue that would otherwise be lost to the Canadian treasury.
