MINISTER WANTS TO CHARGE PST ON ILLEGAL DRUGS

Tax Collectors Get Search Powers. Convicts Linked to Hells Angels Accused
of Evading $20 Million in Sales Taxes

They put the squeeze on parents with children in day care. They shook down
commuters who take public transit. Why not also hit up drug dealers for
much-needed cash?

Quebec Revenue Minister Lawrence Bergman yesterday announced the government
will try to tap a new and unlikely source of tax revenue: illicit drug profits.

"The rules of the (provincial sales tax) say that all goods which are sold
in the realm of a commercial activity are taxable, period," Bergman said,
arguing it's his department's job to collect taxes, not evaluate the
morality of a transaction.

On Wednesday, the department announced it wanted to recover millions of
dollars in unpaid PST on the sale of cocaine and hashish by convicted
criminals linked to the Hells Angels.

It assessed 20 different individuals with criminal records for about $20
million in unpaid taxes, Bergman said.

Quebec yesterday beefed up its collection powers, adopting legislation
enabling tax collectors to secretly search and seize mail and other
documents during major investigations.

Bergman admitted it could take time to actually make the law work. In some
cases he may have to wait for the state to sell off seized homes or assets
before collecting.

Opposition revenue critic Guy Lelievre just laughed when he heard about the
minister's plan. He said Bergman should instead go after corporate
tax-evaders who use foreign countries as tax-free fiscal paradises.

"There's lot's of money at stake. It's $2 billion," said Lelievre, the
Parti Quebecois MNA for Gaspe.

He urged the government to launch a general investigation, but he singled
out Canada Steamship Lines, the shipping company owned by Prime Minister
Paul Martin's family, as a possible target.

Bergman said he wants to apply the same rules to everyone, and pointed out
the department has a Toronto office to investigate outside companies that
do business in Quebec. In some cases, he said the government even sends
investigators abroad to check out companies.

The new rules adopted yesterday will allow the department to secretly seize
material only after getting a warrant from a judge. But Bergman said it's
aimed mainly at a large-scale organized network of tax evaders.

Lelievre said the department doesn't need these extra powers, and he fears
they may lead to unnecessary "fishing trips."