The tax protester (de-taxer) movement is clearly a national phenomenon, with tax protesters in both the west and east having been recently convicted of tax evasion after successful CRA tax prosecutions.
In Quebec, Montréal resident Timothée Bessette pled guilty on November 18, 2016, to a tax evasion charge and he was sentenced to eighteen months in prison. According to the evidence, he advised and helped 11 individuals to avoid or try to avoid paying more than $390,000 in income tax for the 2003 to 2010 tax years by claiming inadmissible expenses to reduce or cancel their taxable income. He acted as a facilitator for Christian Lachapelle, a tax protester promoter, who himself pled guilty to tax fraud charges on October 22, 2015.
The scheme consisted of helping or advising individuals to file income tax returns or request a reassessment using the distinction between a "natural" person and a "legal" person. This de-taxer scheme based on a so-called "natural person" argument that there are two distinct persons for tax purposes has consistently and repeatedly been dismissed as totally without merit or basis in reality by every court that has examined it. All participants and promoters have been subject to tax prosecution and have been convicted of tax evasion and tax fraud charges and many have been sentenced to incarceration.
In the west North Vancouver’s Michael Spencer Millar is set to be sentenced following a guilty finding by a B.C. Supreme Court judge after a tax prosecution for filing false income tax returns, evading income taxes, failing to pay GST and counselling fraud.
Mr. Millar was an “educator” for the Paradigm Education Group, a proponent of the same “natural persons” debunked theory unsuccessfully asserted by Timothée Bessette. Millar is one of at least eight educators and 26 students of the Paradigm tax protester movement who have been convicted of tax evasion in the last several years. Russell Porisky who founded Paridigm was sentenced for tax evasion this past summer to five-and-a-half years in prison. Earlier this month Keith David Lawson, another Paradigm educator, was sentenced to 18 months in jail for tax prosecution convictions for income tax and GST evasion, and counselling to commit fraud.
Evidence at trial showed that Mr. Millar advised 238 participants in the tax protest scheme on how to use the evade taxes, and in line with the Paradigm franchise model charged each of them a percentage of their earnings. One former Participant testified that she asked him what would happen if the scheme “fell apart,” and he falsely advised her that tax prosecution charges had failed against other “natural persons”.
The Canada Revenue Agency (CRA) publicizes tax evasion convictions and is very interested in discrediting tax protestors or de-taxers.
Our top Canadian tax lawyers have experience with tax protester or de-taxer cases and have helped tax protesters to avoid tax prosecution and come back onside with the Canadian income tax system through a CRA voluntary disclosure (VDP or tax amnesty). The CRA tax amnesty program allows Canadians who have tax problems, such as failure to file income tax returns or deliberate income tax evasion by not reporting income or not reporting offshore assets, to avoid tax evasion prosecution and civil tax penalties. Taxpayers have to approach CRA, through our experienced Canadian tax lawyers, by coming forward before CRA commences an income tax audit or opens a tax prosecution investigation. By making a Canadian tax lawyer initiated CRA voluntary disclosure (VDP) the CRA will not initiate any prosecution for tax evasion, will not levy civil tax penalties and will often reduce interest that would otherwise be owing.