Tax Evasion: Calgary Land Flipper

Marco Iampieri B.A., JD, M.B.A

Budget 2022 proposes to provide an additional $1,200 million over five years, starting in 2022-2023 to increase both the investigation and prosecution of entities committing tax evasion. The additional funding will increase CRA’s efficiency and ability to combat tax evasion, which is something it already takes very seriously according to recent examples.

On March 24, 2022., Rodney Potrie, Director of RAP Designs Inc., of Calgary, Alberta, was sentenced to a conditional incarceration sentence of one year and three months and was fined a total of $683,228, which represents 100% of the taxes evaded. In short, Mr. Potrie, through RAP Designs Inc., purchased about 100 acres of vacant land for $3,120,000 in 2008 and then later sold the approximate 100 acres that same year for $7,500,000. RAP Designs Inc., through the direction of Mr. Potrie, filed a nil T2 corporate tax return during its 2008 tax year.

Tax evasion may be investigated by Canadian taxation authorities under the Criminal Code or under Canadian taxation statutes, such as the Employment Insurance Act, the Excise Tax Act and the Income Tax Act. Tax evasion is a crime that affects government administration and the public at large.

Summary of Tax Evasion from April 1, 2020 to March 31, 2021

From April 1, 2020, to March 31, 2020, there were 36 convictions, with Court imposed fines totalling $5,172,884. The 36 taxpayers were sentenced for wilfully evading payment amounts totalling $10,902,950 in federal tax. Further, 15 individuals were incarcerated for a total of 26.2 years.

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