Enforcement Notification - Tax evasion - Sentences for two tax protesters

MONTRÉAL, Feb. 9, 2018 /CNW Telbec/ - The Canada Revenue Agency (CRA) announced that Serge Fréchette, a tax protester from Montréal, and St-Jérôme resident Jean-Pierre Ste-Marie, pleaded guilty today to fraud charges before the Court of Quebec in Laval. They each received a conditional prison sentence of two years minus a day, two years of probation and 480 hours of community service.

A CRA investigation revealed that, between September 2008 and July 2011, Serge Fréchette advised and enabled 120 individuals to evade or try to evade a total of $1,770,210 in federal income tax for the 2003 to 2010 tax years. The scheme he used consisted of helping or advising individuals to file income tax returns or request adjustments in order to claim non-deductible expenses by using the distinction between a "natural" person and a "legal" person. This scheme is based on an argument made by tax protesters, which Canadian courts have repeatedly and consistently rejected.

As for Jean-Pierre Ste-Marie, who acted as a facilitator for Mr. Fréchette, the CRA investigation revealed that, for the 2003 to 2010 tax years, he enabled 95 individuals to evade or try to evade a total of $1,435,000 in federal income tax by claiming false expenses in order to reduce their taxable income. The activities for which Mr. Ste-Marie was charged occurred between September 2008 and July 2011.

All case-specific information above was obtained from the court records.

Tax protesters are individuals who support the false notion that they do not have to pay tax on the income they earn on the basis of a combination of legal and other arguments to place themselves beyond the reach of Canada's tax laws. Participating in a tax protester scheme can have serious consequences including a criminal prosecution leading to jail time and fines. Between 2006 and 2017, 75 taxpayers/promoters from across Canada were convicted of tax offences related to tax schemes. This led to $7.15 million in court imposed fines and a total of 936 months of jail time awarded. To learn more, go to canada.ca/tax-alert

The CRA has set up a free subscription service to help Canadians stay current on the CRA's enforcement efforts.

Associated Links

Offshore Tax Informant Program
Informant Leads Program 
Voluntary Disclosures Program

Stay Connected 

To receive updates on what is new at the Canada Revenue Agency, you can:

•  Follow the CRA on Twitter - @CanRevAgency.
•  Follow the CRA on LinkedIn.
•  Subscribe to a CRA electronic mailing list.
•  Add our RSS feeds to your feed reader.
•  Watch our tax-related videos on YouTube.

SOURCE Canada Revenue Agency