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In the fall economic statement published yesterday, the Canadian government said that it is working on modernizing anti-avoidance rules so that individuals and businesses cannot pay less than what they owe.
“For too long, certain individuals and businesses have been able to create increasingly complex structures in order to artificially lower their tax obligations in a manner that does not serve an economic purpose,” said the statement.
The government will be looking at targeting methods such as shifting profits offshore and creating artificial tax deductions.
To address the issues, the government will launch consultations in the coming months on the modernization of anti-avoidance rules, in particular the General AntiAvoidance Rule.
“It is essential to the integrity of the tax system that our anti-avoidance rules be updated so they are sufficiently robust for tax authorities and courts to address this sophisticated and aggressive tax planning,” the statement added.
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