A former North Vancouver man who made money teaching people how to evade paying taxes has been sent to jail for two and a half years by a B.C. Supreme Court justice.
Michael Spencer Millar was handed the sentence Tuesday morning by B.C. Supreme Court Justice Victoria Gray.
Millar was sentenced after being found guilty last fall of several tax-related charges, including evading paying income tax and failing to pay the Goods and Services Tax over a five-year period ending in 2008, by underestimating his income by $93,000. Millar was also found guilty of counselling people to commit fraud by teaching them they could avoid paying taxes under a discredited scheme.
During his trial, court heard Millar earned fees as an “educator” for the Paradigm Education Group and showed people who enrolled in a course how to evade taxes through debunked interpretations of the Income Tax Act focusing on the idea of a “natural person.” But that theory has never been upheld by the courts, said Gray.
Despite knowing that, Millar taught the tax evasion theory to 238 people in North Vancouver, Kaslo and Calgary, said Gray.
Documents seized during the investigation showed “avoiding income tax was an important aspect of the teaching,” she added.
According to court documents, investigators seized a number of Paradigm teaching materials when they searched Millar’s home and storage locker on Fullerton Avenue under warrant in August 2010.
Millar also sold books and DVDs espousing the debunked theory which gave it an “air of legitimacy,” Gray said.
Three of Millar’s former students filed false tax returns based on the teachings – later voluntarily admitting their actions and paying their back taxes owed.
Millar knew at the time he was teaching that the “natural person theory” had been rejected by the courts, said Gray, and that other Paradigm educators were being pursued by the Canada Revenue Agency.
Gray added most people have their taxes deducted from their pay by employers and never have the chance to avoid paying taxes. Those who do evade taxes not only cheat the government but “inevitably increase the burden on honest taxpayers,” she said, while “thinking nothing of availing themselves of services which the state provides.”
Millar’s sentence includes two years for counselling fraud and six months consecutive for failing to pay taxes. He was also ordered to pay court fines of $24,000 – equal to the amount of tax he evaded, starting when he gets out of prison.
Millar previously indicated that he plans to appeal the decision.
Russell Porisky, the Chilliwack man who was the leader of the Paradigm group, was sentenced in July to five- and-a-half years in prison for similar offences. In that case, court heard Porisky was involved in teaching hundreds of people to evade paying taxes, resulting in a loss of millions of dollars in tax revenue.
Crown prosecutor Suzanne Manery told the judge 32 people have been convicted of tax offences nationwide based on teaching the “natural person theory.”
That has involved counselling others to evade an estimated $4.2 million in taxes, Canada-wide.
