GEORGE TOWN, CAYMAN ISLANDS — The Canada Revenue Agency re-registered its agency’s location offshore to the Cayman Islands last month in a move high-level civil servants are hoping will save the Canadian government hundreds of millions in legal fees and labour.
“The Agency was losing millions investigating and then litigating against wealthy tax-evaders and their high-priced lawyers,” explained an anonymous CRA employee. “Even settling them out of court was a hassle. But then we realized we could register ourselves as a shell government agency in the Cayman Islands with no additional costs. This way we don’t have to audit anyone and we can avoid all the stress entirely!”
The loophole, dubbed the ‘Extra-Territorial Government Taxing Benefit’, was discovered by several former CRA employees who were hired, not long afterwards, by Pricewaterhouse-Coopers, KPMG, Deloitte, and Ernst & Young.
“We should emphasize that we are not evading the enforcement of the law, which is illegal,” the auditor continued. “We are merely avoiding enforcing the law, which is perfectly legal.”
While the financial impact of the move to the Cayman Islands remains to be seen, the boost in CRA employee morale was immediate. “We have a lot of time on our hands and spend most of it counting the crabs on the beach, but we want to assure Canadians that it’s not all fun and games: the CRA will still be rigorously auditing charities for political purposes.”
