Quebec Tax Law faces Constitutional Challenge in Fraud Case
A Montreal businessman convicted of tax fraud is challenging the constitutionality of Quebec’s tax management law, arguing its potential penalties overstep provincial jurisdiction and infringe on federal authority. Tarek Hamza, owner of recruitment firm Otika Services and president of Tunisian youth soccer club El Omrane, claims the law encroaches on areas exclusively governed by the canadian Parliament.
Hamza was found guilty of submitting false invoices to claim tax credits, including $2.6 million worth of fraudulent receipts in one case. He also allegedly concealed his address to hide the purchase of a $5.2 million property and made false claims regarding vehicle ownership. He is currently awaiting sentencing on 14 charges related to these offenses.However, before sentencing, Hamza’s legal counsel, Alexandre Bergevin, filed a notice to the court contesting the law itself.Bergevin argues that the Quebec legislation “indirectly” creates criminal provisions, a power reserved for the federal government under the Criminal Code. While both federal and provincial tax laws carry potential prison sentences, Bergevin points out that Quebec’s maximum penalty – five years minus one day – is significantly higher and perhaps “disproportionate” compared to federal penalties for similar offenses. He further contends this disparity amounts to a form of territorial discrimination.”the provincial legislature cannot adopt provisions that copy,complete or improve the provisions of the Criminal Code or a specific federal law in tax matters,” Bergevin stated in court documents.
The constitutional challenge will involve arguments from both the Attorney General of Quebec and the Attorney General of Canada, and is scheduled to be heard at the Montreal courthouse. The outcome could have notable implications for the scope of provincial authority in tax enforcement.
