November 22, 2017

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Paradise Papers: Critics assail fact Trudeau 'satisfied' with Bronfman's answer

HANOI, Vietnam - Prime Minister Justin Trudeau said Wednesday he's satisfied with the public explanation provided by a top Liberal fundraiser whose name surfaced in leaked documents that provide details on legal, offshore tax havens used by the wealthy.

Trudeau's Conservative and NDP rivals, however, are decidedly less so.

Trudeau, who is in Vietnam for this week's APEC meeting, said he's accepted Stephen Bronfman's response to the so-called "Paradise Papers" that he has never funded nor used offshore trusts, and that all his Canadian trusts have paid all federal taxes on their income.

However, when asked why his close friend appeared to still be in his role as a key Liberal fundraiser, the prime minister did not directly answer, nor would he speak Bronfman's name.

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HANOI, Vietnam - Prime Minister Justin Trudeau said Wednesday he's satisfied with the public explanation provided by a top Liberal fundraiser whose name surfaced in leaked documents that provide details on legal, offshore tax havens used by the wealthy.

Trudeau's Conservative and NDP rivals, however, are decidedly less so.

Canadian Prime Minister Justin Trudeau responds to a question during a joint media availability with Prime Minister of the Socialist Republic of Vietnam Nguyen Huan Phuc in Hanoi, Vietnam Wednesday November 8, 2017. Trudeau says he's satisfied with the public explanation provided by a top Liberal fundraiser whose name surfaced in leaked documents that provide details on legal, offshore tax havens used by the wealthy. THE CANADIAN PRESS/Adrian Wyld

Canadian Prime Minister Justin Trudeau responds to a question during a joint media availability with Prime Minister of the Socialist Republic of Vietnam Nguyen Huan Phuc in Hanoi, Vietnam Wednesday November 8, 2017. Trudeau says he's satisfied with the public explanation provided by a top Liberal fundraiser whose name surfaced in leaked documents that provide details on legal, offshore tax havens used by the wealthy. THE CANADIAN PRESS/Adrian Wyld

Trudeau, who is in Vietnam for this week's APEC meeting, said he's accepted Stephen Bronfman's response to the so-called "Paradise Papers" that he has never funded nor used offshore trusts, and that all his Canadian trusts have paid all federal taxes on their income.

However, when asked why his close friend appeared to still be in his role as a key Liberal fundraiser, the prime minister did not directly answer, nor would he speak Bronfman's name.

"In regards to the specific case you mentioned, we have received assurances that all rules were followed, indeed the same assurances made in the public statement released by the family, and we are satisfied with those assurances," Trudeau told a news conference inside Vietnam's presidential palace.

"We have done much in regards to tax avoidance and tax evasion, including working with international partners.

"But we also recognize there is much more to do and you can rest assured that Canada Revenue Agency will take very seriously its responsibility to go after everyone and anyone involved in tax avoidance and tax evasion."

Tax avoidance measures involving offshore trusts are legal, provided that the trust is genuinely managed offshore and that Canadian taxes are paid on any Canadian contributions. And there may be other legitimate reasons for setting up an offshore account, including if you're a contractor doing work in a particular country.

Still, the questions around Bronfman have given the Liberal government's political foes fresh ammunition to accuse Trudeau of leading an ethically challenged government — and they renewed their attacks Wednesday.

Conservative Leader Andrew Scheer called it "unbelievable" that Trudeau would give Bronfman a clean bill of health so soon after the Canada Revenue Agency had promised to delve more deeply into the murky world of offshore tax havens.

"What kind of message does that send to the Canada Revenue Agency and the people that will be reviewing the file? What kind of message does that send to Canadians?" Scheer asked.

"I think what drives Canadians crazy is when they think there's one set of rules for everyone and a different set of rules for close friends of Liberal ministers or the prime minister."

NDP Leader Jagmeet Singh also called for more investigation, saying it's critical to understand what happened with the Paradise Papers and why Canada's laws allow the super-rich to avoid paying taxes.

"The prime minister says that he is satisfied with the explanation provided by Mr. Bronfman," Singh said. "The reality is Canadians are not satisfied. Canadians expect a just and fair taxation system ... that ensures the wealthy, the well-connected, the powerful also contribute their fair share."

Scheer said the government needs to allow the CRA to determine whether the problem is structural or enforcement-based and give those accused of playing fast and loose with the rules a chance to defend their actions.

"For the prime minister, before any of that work is done, to go out and say 'We are satisfied' — I think that's terribly inappropriate."

Opposition MPs pursued the matter later during question period, demanding to know whether Bronfman will now be excluded from the CRA's promise to review evidence from the Paradise Papers and take any necessary action against tax evaders.

Revenue Minister Diane Lebouthillier said it would be inappropriate for her to comment on an individual case but repeatedly asserted that "no one is above the law."

In his statement, Bronfman said he made a single loan to the trust on an arm's-length, fully commercial basis some 25 years ago that was repaid five months later, a transaction that was fully in compliance with Canadian law.

— Follow @AndyBlatchford on Twitter

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