Private corporations are known for their aggressive way of avoiding tax, out of it billions of dollars can be saved. But how about Crown Corporations? The Canadian Federal pension board is recently exposed of its offshore “scheme” to avoid foreign tax. The federal agency that invests civil pensions exploited loopholes in Berlin Germany by buying apartments through a complex web of shell companies. By law in Germany transfer tax has to be paid if oneself owns 95% of the property, and the federal agency invested through several shell companies and successfully avoided tax. When this matter was revealed German officials characterized Canadian Crown Corporations as to the private corporations who avoid tax super aggressively. This news drawn negative comments from all across Canada.
But think about it. Canada was able so save millions of dollars without breaking any laws and therefore can provide more pension to the citizens of Canada! Every year, brilliant accountants are trying millions of ways to save their firms millions of dollars, and as a result the firm has more to offer to its shareholders. In this case, it is the every retiree that Canada have and will have in the near future who benefit the most. This federal agency should not be under so much heat as it is just merely doing its job, maximizing the pension fund.
It is not difficult to predict that Germany will soon amend this tax law, but corporations will just jump to next loophole or the next country that will save them even more tax money.