Quebec Increases Penalties on Aggressive Tax Planning | KPMG | CA

Quebec Increases Penalties on Aggressive Tax Planning

Quebec Increases Penalties on Aggressive Tax Planning

Quebec has announced new punitive measures to counter aggressive tax planning.

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Specifically, Quebec says it will raise the existing penalty for a General Anti-Avoidance Rule (GAAR) assessment to 50% (from 25%), effective February 1, 2018. Quebec also announced that it will suspend the start of the normal reassessment period in certain situations related to GAAR and said it is making changes to its "tax informant reward" program.

Quebec made this announcement on the same day as it also released an economic action plan that contains other measures related to GAAR, including a restriction that taxpayers who have been subject to GAAR will not be able to enter into contracts with the Quebec government. Further, Quebec's action plan specifies technical changes to its "tax informant reward program" that rewards individuals who provide information about certain transactions that leads to the recovery of a substantial amount of taxes.

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