Montreal would be the dream tax haven for the wealthy of France who want to avoid paying tax, reveals a long-term investigation by the Paris daily Release, which arouses the indignation of the French Minister of the Economy, Bruno Le Maire.
Wealthy French taxpayers have reportedly used the services of the Montreal firm Blue Bridge to create trusts which, under Canadian law, protect capital from tax. The newspaper affirms that billions of euros would have thus landed at the firm founded by Alain Roch, which profited a lot from this windfall.
What is probably at issue here are income trusts which were too popular in Canada in the early 2000s, explains Alain Denault, philosopher and author of the book. Tax havens: the Canadian industry.
He said when then Finance Minister Jim Flaherty tightened the rules governing income trusts, he left a door open for foreign investors who do not have assets in Canada.
“A certain category of investors could still benefit from the tax advantages of income trusts, as long as they did not own any assets in Canada,” he explains, “which escaped us at the time.” ”
This shows, according to him, that Canada can be a tax haven for some investors. “We are not a fiscal supermarket like the Bahamas or others, but we have our specialties, and each country has its own,” he said.
André Lareau, lawyer and tax expert, believes that this is a problem that arises from French law and wealth tax, which exists in France but not in Canada. “It seems to me that this is a problem for the French tax authorities which stems more from French law, and not from a failing Canadian tax system,” he explains.
Other big fortunes in countries that have a wealth tax, which does not exist in Canada, could theoretically do the same thing as the rich French who want to avoid the tax, according to him. It specifies, however, that the income of the trust created in Canada is taxed in Canada since the trustees are Canadian.
In addition, the Autorité des marchés financiers continues to take an interest in Blue Bridge and is monitoring the progress of this file, indicates the regulatory body.
In 2018, Blue Bridge Wealth Management was found guilty by the AMF of having acted as a trust company without holding the required authorizations. “Blue Bridge has, more particularly, gradually incorporated into its operations trust company activities whose volume has become large enough to require it to obtain the required authorizations”, according to the AMF. Blue Bridge had to pay a fine of $ 180,000.
The great Escape
The results of the survey which made the headlines of Release were picked up by other media, including The Obs, which headlines “Hundreds of French millionaires took advantage of a massive tax evasion mechanism via Canada”.
The text had echoes in the National Assembly, reports Agence France-Presse, where the French Minister of the Economy, Bruno Le Maire, was indignant at the situation. “I share your indignation on the question underlined by the ISF [Impôt de solidarité sur la fortune] and on the litigation we have with Canadian trusts, ”the minister said in response to a question from a member of Parliament.
According to him, the French government has been trying for years to obtain information from the Canadian authorities on the use of trusts, which the French call trusts.
The Journal of Montreal had already mentioned the steps the French government had made with the Canada Revenue Agency to obtain information on these trusts and on Blue Bridge, the Montreal firm which served as an intermediary. The Federal Court had also ruled that Blue Bridge had to provide the requested information on its customers.
According to Release, the money which found refuge in Montreal was previously placed in Bermuda, a notorious tax haven which concluded in 2009 an agreement with the French government to fight tax evasion.
Trusts created in Canada, which leave capital tax-sheltered, then became very popular with wealthy French people eager to avoid wealth tax.