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Cameco Saskatoon headquarters
Cameco Headquarters Saskatoon, Saskatchewan, Canada

Cameco is a company that mines uranium in Saskatchewan. In 1999, it signed a deal with its own subsidiary in Zug, Switzerland to sell that uranium to Switzerland at a fixed price of $10 per pound. Switzerland was not the ultimate destination or user of that uranium. The subsidiary in Zug was just reselling it to other jurisdictions around the world at market prices. Of course, the market price of uranium is variable, but it has consistently been quite a bit more than $10 a pound. It is currently around $30 a pound. It was up to as high as $140 a pound in 2007. The only real effect of this arrangement was to transfer billions of dollars of profits from Canada to this Swiss tax haven. The Canada Revenue Agency has calculated that from 2003 through 2015, that cost the governments of Canada and Saskatchewan more than $2 billion in lost tax revenue.” (Mr. Erin Weir, 17 June 2016)
Cameco Zug Alpenstrasse 15
Cameco, Alpenstrasse 15, Zug, Switzerland. There is no street view.

Cameco has three subsidiaries listed as domiciled at Alpenstrasse 15, Zug, Switzerland. They are Cameco Europe AG, formerly Cameco Switzerland AG, since 17.09.1999; Cameco Investments AG since 04.08.1999 and Cameco Europe (Central Asia) AG, since 24.08.2010. Approximately 150 companies-subsidiaries are listed as domiciled at this address in Zug, including Cameco’s three. Note that two of Cameco’s subsidiaries were apparently domiciled at the address in 1999, the same year that Cameco signed a deal with its subsidiary, suggesting that one or both 1999 subsidiaries may have been created and/or domiciled in Zug for the purpose of tax avoidance.

Cameco’s Tax Avoidance brought up in Canada’s House of Commons during debate of Income Tax Act:
42nd PARLIAMENT, 1st SESSION
EDITED HANSARD • NUMBER 075
 CONTENTS Friday, June 17, 2016
House of Commons Debates, VOLUME 148 NUMBER 075 
1st SESSION , 42nd PARLIAMENT OFFICIAL REPORT (HANSARD)
Friday, June 17, 2016, Income Tax Act
“1045

[…]
Mr. Erin Weir (Regina—Lewvan, NDP):  
Madam Speaker, we are here today debating a tax bill. I would begin by observing that our federal government is faced with a very serious revenue problem. The Conservative members of this House like to pat themselves on the back for the fact that federal tax revenues as a share of gross domestic product are at their lowest level in about half a century.

Some hon. members: Hear, hear!

Mr. Erin Weir: They are free to applaud that, Madam Speaker.
Of, course, the flip side of that is that we do not have enough resources to fund important public services and necessary infrastructure. That is one of the main reasons we have a big federal deficit. It is important that if we want to live in a civilized society, we need to have ways of raising the revenue to pay for those services and those infrastructures that we depend on.
    
What has the government done in terms of generating that needed revenue?

Bill C-2 proposes an additional four percentage points of personal income tax on incomes over $200,000 per year. That is definitely a positive initiative, but it is also a fairly minor initiative. It does not actually raise very much revenue…
We, in the NDP, have suggested that the government might look to the corporate sector as a source of additional revenues to pay for public services.

It is interesting. This morning, the Toronto Star and CBC have come out with a joint investigation that looks into the loss of revenue to offshore tax havens. It notes that all of these tax information exchange agreements that the former Conservative government was very keen to sign have actually made the problem worse.

The goal of these agreements was obviously to achieve greater transparency, to get more information about what was going on in tax havens. However, what the Conservatives did while they were in power was to put in place a policy whereby once a country had signed one of these tax information exchange agreements, there was no more enforcement. Canadian companies could just repatriate profits tax free from those jurisdictions. Far from curtailing offshore tax avoidance, this plethora of tax information exchange agreements has actually made the problem worse. I think that is a problem that we need to be addressing in this House.

I would also like to talk a bit about a specific case of offshore tax avoidance that I think really illustrates the problem.

Cameco is a company that mines uranium in Saskatchewan. In 1999, it signed a deal with its own subsidiary in Zug, Switzerland to sell that uranium to Switzerland at a fixed price of $10 per pound. Switzerland was not the ultimate destination or user of that uranium. The subsidiary in Zug was just reselling it to other jurisdictions around the world at market prices. Of course, the market price of uranium is variable, but it has consistently been quite a bit more than $10 a pound. It is currently around $30 a pound. It was up to as high as $140 a pound in 2007.

The only real effect of this arrangement was to transfer billions of dollars of profits from Canada to this Swiss tax haven. The Canada Revenue Agency has calculated that from 2003 through 2015, that cost the governments of Canada and Saskatchewan more than $2 billion in lost tax revenue.

This is a huge scandal. It first came out in 2013. At that time, I was struck by the fact that Saskatchewan’s Conservative MPs and one Liberal MP were totally silent on the matter. Fortunately, we now have some New Democratic MPs from the province who are going to speak up for tax fairness and raise issues like this.

(1050)  
It is very concerning that we have this company that is making huge profits off of Canadian resources and then transferring those profits out of the country, in a very brazen way, in order to avoid paying tax on it.

The good news is that the Canada Revenue Agency has started to pursue this matter. That is the way in which it came out publicly in 2013. However, the news that is a little more concerning is that there has been a real tradition of both Conservative and Liberal governments not actually following through on these cases, and instead signing these deals that let the tax cheats off the hook.

Part of the reason that I want to bring the Cameco case forward in this House is to put it on record, to make sure that the Government of Canada is actually going to follow up on this and not let the company get away with this scam.

I am not alone in this. Earlier this week, an organization called Canadians for Tax Fairness presented a petition signed by more than 36,000 people, calling on Cameco to make these tax payments. There are a lot of people who are concerned about this, and finally they have some Saskatchewan voices in Parliament speaking up for them.

I would also like to touch on the provincial side of this whole question. The tax base to which provincial taxes apply is actually defined by the Government of Canada. When you have a company like Cameco shifting taxable profits out of the country, it is not just the federal government that loses out; it is also the Government of Saskatchewan that is no longer able to collect the appropriate taxes on that money.

This is a pressing concern, because the Government of Saskatchewan is running a huge deficit right now. The Government of Saskatchewan really needs that money to maintain important public programs in our province. This is a critical issue. It has just come to light recently that the small “c” conservative government in Saskatchewan refused to present a budget prior to the recent provincial election because they wanted to conceal the fact that they were running this big deficit.
 
Now we know there is a huge deficit there, and we know how important it would be for the Province of Saskatchewan to be able to collect fair corporate taxes from the profits generated from our province’s resources. It is not just about Cameco. This point is applicable to the whole question of offshore tax avoidance.

If the federal government were to do a better job of preventing this tax avoidance and tax evasion, and actually make sure that the correct amount of profit was subject to federal corporate income tax, that would also mean those profits could be subject to provincial corporate income tax.

I think almost all provincial governments are in deficit right now, and one of the best things this Parliament could do to help our provincial governments generate the revenues they need for health care, education, and social services would be to get our tax system in order. It wants to make sure that appropriate reporting is being done, so that not only do we have adequate revenues for the federal government, but so that our provincial counterparts can fund their operations in an appropriate way as well.

We are facing a huge revenue problem in this country. We have tax rates at historic lows, which are not sufficient to fund the important services and necessary infrastructure on which Canadians rely. Why is this happening? Obviously, one of the problems is that the general corporate tax rate has been cut. As my colleague pointed out, that has led to a huge loss of revenue and has not produced investment in our economy.

The other issue is that whatever the tax rate, it is not actually being applied because of these offshore tax schemes, which were aggravated by the recent Conservative government, of which Cameco in Saskatchewan is a particularly egregious example. We need to focus on this problem and come up with concrete solutions to collect appropriate revenues…. (Emphasis our own) http://www.parl.gc.ca/content/hoc/House/421/Debates/075/HAN075-E.PDF http://www.parl.gc.ca/HousePublications/Publication.aspx?Pub=hansard

Cameco has 3 subsidiaries located in Zug at Alpenstrasse 15. There are around 150 companies-subsidiaries, more or less, listed at this same address.
http://www.moneyhouse. ch/en/domicile/Zug/Alpenstrasse_15.htm (Link intentionally broken because it is unclear if they allow links. You can reconstitute the link. Or do a search at Moneyhouse Switzerland and see who is at the address. There are many. We only counted the active ones which are not undergoing dissolution.)

Cameco address: 2121-11TH STREET WEST
SASKATOON, SK  S7M 1J3
Canada
Cameco lobbying: https://lobbycanada.gc.ca/app/secure/ocl/lrs/do/clntSmmry;jsessionid=e8gYEOiyA5VdCtRx4oaTZKyp.app-ocl-01?clientOrgCorpNumber=377&sMdKy=1456357552079