Government subsidizing food processors to buy PPE for workers raises questions over Canada’s COVID-19 support for billionaire tax avoiders

The Government of Canada’s decision to provide $77.5 million funding for food processors to buy personal protective equipment(PPE) for their workers is raising questions about the propriety of subsidizing billionaire tax avoiders.

“Genuinely puzzled,” former Toronto Mayor David Miller tweeted^[1]https://twitter.com/iamdavidmiller/status/1257692706907869186. “Cargill is owned by 14 Billionaires. Can’t they afford PPE for their workers? Quote Tweet”

The High River, Alberta slaughterhouse operated by Cargill Ltd has become the site of Canada’s largest COVID-19 outbreak with nearly 1,000 out of the 2,000 workers infected.

“Cargill is not only the largest food company in the world, it is also the largest privately held company in the world,” according to a press release by Canadians for Tax Fairness(CTF)^[2]https://www.taxfairness.ca/en/news/cargill%E2%80%99s-slaughterhouse-profits-flow-through-tax-havens-keep-its-billionaire-owners-wealthy. “It is 90% owned by the extended Cargill and MacMillan family. With more than 14 billionaires , they are the largest billionaire family in the world, with more than US$50 billion in net wealth among all of them.”

Cargill’s annual revenues exceeded US $100 billion each year for the last five years and the company reported profits average US$2.5 billion annually^[3]https://www.cargill.com/about/financial/five-year-financial-summary.

CTF accuses Cargill of sheltering much of their true profits in offshore tax havens.

“Most of Cargill’s Canadian corporations are owned through two Luxembourg-based holding companies: Cargill International Luxembourg 6 S.A.R.L. and Cargill International Luxembourg 12 S.A.R.L. Together these two holding companies own 100% of Cargill Ltd (registered in Manitoba), through which they own dozens of other companies registered in Canada,” CTF explains. “Cargill also has a major financing and trading subsidiary based in Switzerland and subsidiaries based in Caribbean tax havens of Bahamas, Barbados and the British Virgin Islands that were exposed through the Paradise Papers and other tax leaks.”

The support for food processors is part of the $225 million coronavirus aid package Prime Minister Justin Trudeau announced yesterday.

“We are creating a $77.5 million Emergency Processing Fund to help food producers access more personal protective equipment (PPE), adapt to health protocols, automate or modernize their facilities, processes, and operations, and respond to emerging pressures from COVID-19 so they can better supply Canadians with food during this period,” the government announced on the official website^[4]https://www.canada.ca/en/department-finance/economic-response-plan.html#businesses.

It’s unclear how much of that will go to Cargill, which employs over 8,000 people across Canada.

Occupational Health and Safety Alberta is currently investigating the High River plant to identify any potential non-compliance after employees accused Cargill of neglecting to provide PPE to workers^[5]https://www.alberta.ca/release.cfm?xID=7021501DA9B82-0155-0E5C-ADE46F57FC5CC428.

Prime Minister Justin Trudeau has been vague about whether Canada will follow the example set by France, Denmark and Poland inl withholding subsidies from corporations registered in offshore tax havens.

“Mr. Chair, since 2015 we have made significant investments in the CRA to fight against tax avoidance and tax evasion. This is something we’ve taken very seriously as a country, and there will always be strong consequences for anyone who avoids paying their fair share of taxes,” Trudeau told parliament last week^[6]https://www.ourcommons.ca/DocumentViewer/en/43-1/COVI/meeting-2/evidence#Int-10826880. “At the same time, we’ve been investing to ensure that Canadians get the supports they need, regardless of whether they work for small or large companies.”