A Chilliwack tax evader who counselled others through his Paradigm Education Group to do the same was sent to jail for four and a half years, the Canada Revenue Agency reported Thursday.
Russell Anthony Porisky was sentenced to prison in B.C. Supreme Court and fined $274,815 for one count of counselling others to evade taxes, and two counts of tax evasion.
Porisky, 51 and a father of four, also failed to collect and remit $66,133 in goods and services tax.
He received 18 months in jail for income-tax and GST evasion and another three years for fraudulent counselling of the students, the terms to be served consecutively.
Elaine Gould, 52, Porisky’s common-law wife and a mother of three, was fined $27,434 for one count of tax evasion and received a six-month conditional sentence order.
The CRA reported the pair failed to report $1,127,185 in taxable income from 2004 to 2008, and evaded $237,898 in federal income tax.
At sentencing Gould told B.C. Supreme Court Justice Elliott Myers she had no job.
“How am I going to pay the fine?” she said.
The judge told her that she had a year to pay the penalty.
“If you can’t do it, you’ll have to come before me to explain why you can’t and tell me what efforts you’ve made to do it,” Meyers told her.
The couple kissed before Porisky was taken into custody by sheriffs.
Several supporters sitting in the public gallery behind Porisky waved at him as he was led away.
The couple was convicted in January.
The prosecution had argued that counselling of 800 clients to commit fraud resulted in more than $11 million in tax evasion. Myers said that was only a rough estimate he couldn’t accept, but agreed the sum was substantial as was the gain to Porisky, who represented himself at the couple’s trial.
Porisky gained notoriety for promoting a “natural man” theory, in which he says “natural” person – versus an “artificial” person – is not obligated to pay taxes.
Through his Paradigm Education Group, Porisky sold books, DVDs and seminars, advising people to not to pay their taxes.
Meyers found “there is no legal merit to any of Mr. Porisky’s arguments,” noting several of Porisky’s followers have also been sent to jail for tax evasion.
“[Porisky] went out of his way to build a tortured and baseless argument in support of his moral and political belief that individuals can opt out of the income tax system,” said Meyers. “He acted on that misguided belief by opting out himself and urging others to do the same.”
The CRA labels such claims as tax myths. The agency said individuals who plan to use the tactics of tax protesters should know there may be significant personal and financial consequences, including fines, imprisonment or seizure of goods.
When individuals are convicted of income tax fraud, they must still repay the full amount of taxes owing, plus interest and any civil penalties that may be assessed by the CRA.
In addition, the court may fine them up to 200 per cent of the taxes evaded and impose a jail term of up to five years.
For information regarding tax myths and their consequences, see the CRA website at www.cra.gc.ca/nwsrm/myths
Taxpayers who have not filed returns for previous years, or who have not reported all of their income, can still voluntarily correct their tax affairs.
They may not be penalized or prosecuted if they make a valid disclosure before they become aware of any compliance action being initiated by the CRA against them.
These taxpayers may only have to pay the taxes owing, plus interest. Find more information on the Voluntary Disclosures Program at www.cra.gc.ca/voluntarydisclosures
– with files from The Province
