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Taxpayers DO have the right to remain silent

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7 minute read

A taxpayer-friendly unanimous Federal Court of Appeal ruling came out this week in MNR v Cameco [2019 FCA 67]. At issue was whether or not the Minister (through the CRA) has the authority to compel oral answers to oral questions from taxpayers or their employees.

In his ruling, Justice of Appeal Rennie stated “…the Minister does not have the power to compel a taxpayer to answer questions at the audit stage…”, however, it may be in the best interest of the taxpayer to provide reasonable answers to reasonable questions in order to expedite the process. The full entire ruling can be found and read here

This ruling simply re-confirms, that even in an audit, you (and your staff) have the right to remain silent, and that the Minister’s powers are limited to physical evidence.

An exception to this is you are required to provide assistance in locating and providing that physical evidence, which may need to be orally.

Personally, when dealing with a very large number of taxpayers on our own office, we want to be certain that the file that the CRA is talking about is the same file in front of us. As such, we are a firm believer in the Canadian Home Builders’ Association motto that is ironically supported by the Government of Canada: “Get it in Writing.”

I am not advocating answering no questions, as the Minister (CRA) still has the ability to issue reassessments, thereby shifting burden of proof to the taxpayer further to disprove the reassessment.

I am, however, advocating at a minimum to get those questions detailed, and in writing. This will help to provide clarity and allow for proper thought in your answers as opposed to stating something with unintended consequences.

Here is a little example of what happens when you don’t get it in writing: in my dark-side days as a field auditor with the (then called) CCRA, we used to ask prying questions that the taxpayer had no idea they were answering.

For example, in one particular circumstance I was reviewing a file where it was suggested that the taxpayer was doing under-the-table cash jobs. This meant I would have to be creative in figuring out the taxpayer’s cost of living, and ruling out other sources of income.

Meeting in a quiet restaurant in a small Saskatchewan town, I was eventually able to have the taxpayer relaxed enough to think that we were having a normal conversation. Just a couple of ‘Riders fans that aren’t a fan of Ottawa, but hey, I have a job to do. When the taxpayer started complaining about the government, I joined in:

“Hey, I hear you. I’m not some suit from Ottawa. I’m from Regina. I mean both the feds and the province already get enough out of me from tax on my smokes.”

I don’t smoke.

The taxpayer didn’t know that, but the anger was timely because the province had just raised up the cigarette tax the previous year so packs were well over $6 a pack.

“Yeah I know”, the taxpayer said, “I smoke a pack a day”.

Music to my ears as a tax auditor, the taxpayer just told me that they need ($6 x 365) = $2,190 of after-tax income just to feed their cigarette habit.

I continued, “That’s terrible! Between getting our money on that, and getting it at the casino, it’s just crazy how much they make it hard to enjoy our weekends.”

“Yeah, I don’t win nuthin’ at the casino either,” the taxpayer stated.

To me I heard ‘I didn’t have any non-taxable casino winnings. In fact, the taxpayer likely had lost money in the year. This means the taxpayer needed to have more disposable income to gamble.’

The conversation continued for a good 30 minutes. Once I was armed with more knowledge of the taxpayer’s lifestyle and spending habits, I went to work. Bank statements, receipts, mileage information, fuel costs, type of vehicle, etc.

We would use information tools not only from Statistics Canada for price of fuel in different regions, we would also use websites like www.fueleconomy.gov that provide different estimated fuel consumption based on type of use and mileage going back to cars from the 1980s. Then we work backwards to see if the numbers made sense with respect to the taxpayer’s vehicle and costs.

When it was all said and done, I used the results of our conversation against the taxpayer. When I was finished, I found over $30,000 in an income variance between the taxpayer’s living costs and change in net worth compared to what was reported. Not only that, but the taxpayer had already backed themselves into a corner because of the questions that were answered which I had documented.

My guess is that in conclusion, the taxpayer thought they should have got the questions in writing instead of meeting me at a restaurant.


Cory G. Litzenberger, CPA, CMA, CFP, C.Mgr is the President & Founder of CGL Strategic Business & Tax Advisors; you can find out more about Cory’s biography at http://www.CGLtax.ca/Litzenberger-Cory.html

CEO | Director CGL Tax Professional Corporation With the Income Tax Act always by his side on his smart-phone, Cory has taken tax-nerd to a whole other level. His background in strategic planning, tax-efficient corporate reorganizations, business management, and financial planning bring a well-rounded approach to assist private corporations and their owners increase their wealth through the strategies that work best for them. An entrepreneur himself, Cory started CGL with the idea that he wanted to help clients adapt to the ever-changing tax and economic environment and increase their wealth through optimizing the use of tax legislation coupled with strategic business planning and financial analysis. His relaxed blue-collar approach in a traditionally white-collar industry can raise a few eyebrows, but in his own words: “People don’t pay me for my looks. My modeling career ended at birth.” More info: https://CGLtax.ca/Litzenberger-Cory.html

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Frontier Centre for Public Policy

The tale of two teachers

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From the Frontier Centre for Public Policy

By Jim McMurtry

Some have criticized me for stating that the good, as well as the bad, of residential schools should be recognized. I stand by that statement…. Others have criticized me for stating that the Truth and Reconciliation Report was not as balanced as it should be. I stand by that statement as well.

At L.A. Matheson, a high school in Surrey, B.C., a poster in Annie Ohana’s classroom suggests society is too moralistic about sex work, the quote coming from an avowed Satanist. National Post writer Jamie Sarkonak described her classroom in this way: “The walls are covered with Social Justice posters. Some of them sloganeer about ‘decolonization,’ others ‘inflame racial politics.’” Ohana drapes herself in a Pride flag and speaks openly of her pansexuality as well as her subscription to wokeism, identity politics, Social Justice, and DEI.

In March Ohana appeared on CTV after being roundly criticized on X by an Ottawa teacher, Chanel Pfahl, the latter chased out of the profession a few years ago for questioning Critical Race Theory. Ohana said that Pfahl “seems to be making a lot of assumptions that were simply based on misinformation, lies, and in fact, puts myself and other teachers and students and my community in danger.” She also argued she was teaching about “critical thinking” and creating “empowered citizens that can speak up for themselves.” A Canadian flag hangs forlornly in her classroom, atop it is scrawled, “No pride in genocide.”

So far, she has faced no direct consequences for her political position or trying to indoctrinate her students. Indeed, she has won three teaching awards.

I, on the other hand, was walked out of my classroom and career for suggesting the only thing buried in Kamloops was the truth. In the eyes of my employer, I had put students and the community in danger by saying students who died while enrolled at a residential school did so from disease and not murder.

Northrop Frye wrote in The Great Code that the aim is “to see what the subject means, not to accept or reject it.” There is nothing wrong with the teaching of either me or Ohana as long as we are not steering students toward belief. In a 100-page investigation report on my teaching, an assistant superintendent of the Abbotsford School District wrote:

It in my view cannot be overemphasized that Mr. McMurtry having no knowledge of his students and more particularly whether any of these students had Indigenous descent in making his comments that provoked a strong student response and which was contrary to the school’s message of condolences and reconciliation. Regardless of his intent he left students with the impression some or all the deaths could be contributed to ‘natural causes’ and that the deaths could not be called murder or cultural genocide.

My fault was that I didn’t promote a “message of condolences and reconciliation.” Not only was this message never communicated to teachers, the message runs counter to the educational aim of seeing what a subject means. The message is also that the deaths of at least some Indian residential school children were attributable to murder, for which there is still no evidence.

Senator Lynn Beyak was the first prominent Canadian to wade into the increasingly turbulent waters of Indian residential schools. Labelled a racist and facing the prospect of ejection from the Senate, she retired in 2021 from her senate position but not from her convictions.

Some have criticized me for stating that the good, as well as the bad, of residential schools should be recognized. I stand by that statement…. Others have criticized me for stating that the Truth and Reconciliation Report was not as balanced as it should be. I stand by that statement as well.

George Orwell wrote in 1945 in an introduction to Animal Farm, “At any given moment there is an orthodoxy, a body of ideas of which it is assumed that all right-thinking people will accept without question. It is not exactly forbidden to say this, that or the other, but it is ‘not done’ to say it.” Queen’s law professor Bruce Pardy wrote last year: “A new standard of practice is emerging for Canadian professionals: be woke, be quiet, or be accused of professional misconduct.”

Annie Ohana is a better approximation of that mythically average teacher than I. Most teachers appear woke or know enough to be quiet and go along, standing for land acknowledgments, using individualized pronouns with students, speaking of gender identity and sexual orientation, distinguishing students based on race, reading Social Justice books over literary classics, and accepting revisionist history. They go to school wearing the right colour for the occasion: rainbow, pink, orange, red, or black. At staff meetings they are woke and quiet.

I am an avatar of Lynn Beyak, standing outside the orthodoxy and condemned by “all right-thinking people.” Our issue is also the same. Indian residential schools were not the genocidal project that federal members of parliament voted as a genocide on October 27, 2022.

The Truth and Reconciliation Commission, headed by two Indigenous men and a woman married to an Indigenous man, travelled for six years across Canada, and heard from 6000 former students. The Commission’s bias was evident in its final report:

Physical genocide is the mass killing of the members of a targeted group, and biological genocide is the destruction of the group’s reproductive capacity. Cultural genocide is the destruction of those structures and practices that allow the group to continue as a group. States that engage in cultural genocide set out to destroy the political and social institutions of the targeted group. Land is seized, and populations are forcibly transferred and their movement is restricted. Languages are banned. Spiritual leaders are persecuted, spiritual practices are forbidden, and objects of spiritual value are confiscated and destroyed. And, most significantly to the issue at hand, families are disrupted to prevent the transmission of cultural values and identity from one generation to the next. In its dealing with Aboriginal people, Canada did all these things.

What the final report does not mention is:

o   the educational value of the schools;

o   the alternative was no education at all in remote areas where a day school was not feasible;

o   that both Indigenous chiefs and parents saw them as a treaty right and petitioned to keep them open into the sixties;

o   that parents had to apply to send their children to residential schools;

o   that the mandatory attendance which began in 1920 was to go to school (one-third going to day school, one-third to residential school, and one-third never going to any school);

o   that the schools took in orphans and served as a refuge for children and in some cases adults who were abused on the reserve or without the necessities of life; and

o  that many former students testified their time there was the happiest in their lives.

My natural allegiance is to fellow teachers, and I don’t doubt that Annie Ohana and others within the Critical Social Justice educational movement teach their students about critical thinking and create empowered citizens that can speak up for themselves. However, such critical thinking should also be directed against the orthodoxy these teachers are imposing on captive groups of students. As well, if their students are indeed empowered citizens, they should come to their own conclusions, no matter the ideological perspective of their teacher.

 Jim McMurtry, PhD, was formerly a principal of Neuchâtel Junior College in Switzerland and a college lecturer, but mostly he was a teacher. He lives in Surrey, B.C.

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Opinion

Fentanyl Fiasco: The Tragic Missteps of BC’s Drug Policy

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From The Opposition News Network

Unmasking the Destructive Cycle of Drug Policy in British Columbia. A Tale of Good Intentions and Dire Consequences

My fellow Canadians, it’s been a challenging time. I had initially planned to bring you the latest spectacle from the House of Commons, featuring Kristian Firth, but fate had other plans. A personal emergency struck closer to home—a fentanyl overdose in the family. This tragic event threw us headlong into the chaotic circus that is the British Columbia health system. Let me be frank: the system is a mockery. The privacy laws that supposedly protect us also shroud our crises in unnecessary mystery. When my uncle was found unconscious and rushed to the ICU, the walls of confidentiality meant we could not even ascertain his condition over the phone. They notify you of the disaster but cloak its nature in secrecy. It’s an absurdity that only adds to the anguish of families grappling with the realities of addiction.

Now, let’s address the elephant in the room: our approach to drug addiction. The authorities label it a disease, yet paradoxically offer the afflicted the choice between seeking help and remaining in their dire state. This half-hearted stance on drug addiction only perpetuates a cycle of relapse and despair. As we speak, thousands tumble through the revolving doors of our medical facilities—5,975 apparent opioid toxicity deaths this year alone, an 8% increase from 2022. Daily, we see 22 deaths and 17 hospitalizations, and yet our response remains as ineffective as ever. This issue transcends our national borders. The U.S. has openly criticized China for its role in the opioid crisis, accusing it of flooding North America with fentanyl—a drug so potent, it’s decimating communities at an unprecedented rate. Just last year, over 70,000 Americans succumbed to fentanyl overdoses. And what’s more damning? Reports from U.S. congressional committees suggest that the Chinese government might be subsidizing firms that traffic these lethal substances. Lets be clear this is a state-sponsored assault on our populace.

In response to this crisis BC NDP policymakers have championed the notion of “safe supply” programs. These initiatives distribute free hydromorphone, a potent opioid akin to heroin, with the intention of steering users away from the perils of contaminated street drugs. At first glance, this approach might seem logical, even humane. However, the grim realities paint a far different picture, one where good intentions pave the road to societal decay. Addiction specialists are sounding the alarm, and the news isn’t good. While hydromorphone is potent, it lacks the intensity to satisfy fentanyl users, leading to an unintended consequence: diversion. Users, unappeased by the drug’s effects, are selling their “safe” supply on the black market. This results in a glut of hydromorphone flooding the streets, crashing its price by up to 95% in certain areas. This collapse in street value might seem like a win for economic textbooks, but in the harsh world of drug abuse, it’s a catalyst for disaster. Cheap, readily available opioids are finding their way into the hands of an ever-younger audience, ensnaring teenagers in the grips of addiction. Far from reducing harm, these programs are inadvertently setting the stage for a new wave of drug dependency among our most vulnerable.

Programs designed to save lives are instead spinning a web of addiction that ensnares not just existing drug users but also initiates unsuspecting adolescents into a life of dependency. What’s needed isn’t more drugs, even under the guise of medical oversight, but a robust support system that addresses the root causes of addiction yet, the stark reality on the streets tells a story of systemic failure. Let’s dissect the current approach to handling addiction, a condition deeply intertwined with our societal, legal, and health systems.

Take a typical scenario—an individual battling the throes of addiction. Many of them find themselves ensnared by the law, often for crimes like theft, driven by the desperate need to sustain their habit. Yes, many addicts find themselves behind bars, where, paradoxically, they claim to clean up. Jail, devoid of freedom, ironically becomes a place of forced sobriety.

Now, consider the next step in this cycle: release. Upon their release, these individuals, now momentarily clean, are promised treatment—real help, real change. Yet, here’s the catch: this promised help is dangled like a carrot on a stick, often 30 or more days away. What happens in those 30 days? Left to their own devices, many relapse, falling back into old patterns before they ever step foot in a treatment facility.

This brings us to a critical question: why release an individual who has begun to detox in a controlled environment, only to thrust them back into the very conditions that fueled their addiction? Why not maintain custody until a treatment spot opens up? From a fiscal perspective, this dance of incarceration, release, and delayed treatment is an exercise in futility, burning through public funds without solving the core issue. Moreover, from a standpoint of basic human decency and dignity, this system is profoundly flawed. We play roulette with lives on the line, hoping against odds for a favorable outcome when we already hold a losing hand. This isn’t just ineffective; it’s cruel.

Final Thoughts

As we close the curtain on this discussion, let’s not mince words. The BC system’s approach to drug addiction treatment isn’t just flawed; it’s a catastrophic failure masquerading as mercy. Opposition leader Pierre Poilievre has hit the nail squarely on the head in his piece for the National Post. He articulates a vision where compassion and practicality intersect, not through the failed policies of perpetual maintenance, but through genuine, recovery-oriented solutions. His stance is clear: treat addiction as the profound health crisis it is, not as a criminal issue to be swept under the rug of incarceration.

Contrast this with the so-called ‘safe supply’ madness—a Band-Aid solution to a hemorrhaging societal wound. In the dystopian theatre of the Downtown Eastside, where welfare checks and drug dens operate with the efficiency of a grotesque assembly line, what we see is not healthcare, but a deathcare system. It’s a cycle of despair that offers a needle in one hand and a shot of naloxone in the other as a safety net. This isn’t treatment; it’s a perverse form of life support that keeps the heart beating but lets the soul wither.

Come next election in BC, if any provincial party is prepared to advocate for a true treatment-first approach, to shift from enabling addiction to empowering recovery, they will have my—and should have your—unwavering support. We must champion platforms that prioritize recovery, that respect human dignity, and that restore hope to the heartbroken streets of our communities.

The NDP BC government’s current model perpetuates death and decay under the guise of progressive policy. It’s a cruel joke on the citizens who need help the most. We can no longer afford to stand idly by as lives are lost to a system that confuses sustaining addiction with saving lives. Let’s rally for change, for recovery, for a future where Canadians struggling with addiction are given a real shot at redemption. This isn’t just a political imperative—it’s a moral one. The time for half-measures is over. The time for real action is now.

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