Canada using Panama free trade deal to chase tax cheats

Montreal (AFP) - Canada is leveraging a free trade agreement with Panama to root out tax evaders, Prime Minister Justin Trudeau said Thursday in the wake of the Panama Papers revelations.

"We will use levers within this free trade agreement to ensure that Canadians do not use tax havens, tax evasion and tax avoidance," Trudeau said in an interview with public broadcaster Radio-Canada.

The trade pact, which came into force in 2013, "outlines specific (state) responsibilities in fighting tax evasion," he said, without providing details.

Trudeau welcomed the worldwide media spotlight on the 11.5 million leaked documents from the Panama law firm Mossack Fonseca, saying it has provided a wealth of leads for tax authorities to investigate possible wrongdoing, and has highlighted why "real action" is needed against tax evasion.

He added, however, that Canada alone cannot eradicate tax cheating, and urged cooperation among nations to tighten controls.

The vast stash of records from Mossack Fonseca was obtained from an anonymous source by German daily Sueddeutsche Zeitung and shared with more than 100 media groups by the International Consortium of Investigative Journalists.

The network of journalists published their first findings Sunday after a year-long probe.

Offshore financial dealings are not illegal in themselves, though they may be used to hide assets from tax authorities, launder proceeds of criminal activities or conceal misappropriated or politically inconvenient wealth.

According to the Toronto Star, which is a member of the consortium, some 350 Canadians are listed in the leaked documents.

That prompted the Canada Revenue Agency earlier this week to ask for copies of the Panama Papers in order to cross-reference the information with its own files.