The United Brotherhood of Carpenters and Joiners of America’s Canadian District (UBC) has launched an awareness campaign to highlight tax fraud within the construction industry and its detrimental effects on workers and communities. This initiative is part of the UBC’s annual “Tax Fraud Days of Action,” which is scheduled to take place from April 13-19, 2024.
This year’s campaign theme, “Ask Yourself Why,” encourages Canadians to scrutinize dubious business practices prevalent in the construction sector. It specifically targets issues such as underpayment and lack of proper workplace benefits for construction workers, particularly those paid in cash. “The unfortunate answer to both questions is worker exploitation,” stated Jason Rowe, Vice President of the UBC Canadian District. He further detailed that such workers often lack essential protections because some contractors evade paying necessary taxes and premiums, such as HST, CPP, EI, and workers’ compensation.
Rowe highlighted that unsafe working conditions are frequently linked to these fraudulent practices, especially in the residential construction area on non-union job sites. “We see these kinds of illicit practices most often in the residential construction sector on non-union jobsites. It becomes a vicious cycle where injuries and hardship become increasingly inevitable,” he said.
The campaign also underscores the broader impact of construction industry tax fraud on the economy. According to Statistics Canada, the underground economy represents $61.2 billion in economic activity, with residential construction topping the list as the most culpable, accounting for approximately $16 billion of that total. The campaign argues that this not only affects competition by disadvantaging law-abiding businesses but also results in significant tax revenue losses that could otherwise fund public services.
In response, the UBC is advocating for several measures to combat these issues. These include increasing transparency in government project procurement processes, collaborating with Canada Revenue Agency to pinpoint and address tax fraud, and pushing for legislative changes to enhance accountability for contractors regarding their subcontractors’ legal violations.
The UBC invites all interested parties to learn more and join their cause at their dedicated website, stoptaxfraud.ca.
