The Canada Revenue Agency and the United Kingdom’s tax authority conducted searches June 13 in three Canadian locations and 6 in the UK as part of an ongoing international investigation into an alleged tax fraud scheme, called a carousel scheme.
The CRA launched an investigation when it found that over five years, 11 foreign nationals based in the UK allegedly orchestrated a tax fraud and money laundering scheme by attempting to obtain $52 million in false GST/HST refunds and rebates, said the CRA in a statement.
May face prosecution
The CRA has publicized this investigation as a warning to Canadians about carousel schemes. It warns that tax evaders not only have to repay the tax they tried to evade plus penalties, but may also face prosecution.
In its statement, the CRA acknowledged the collaboration of the United Kingdom’s tax authority, the Financial Transactions and Reports Analysis Centre of Canada, the Canada Border Services Agency, and the Royal Canadian Mounted Police.