Finances—Revenue Canada

Revenue Canada
Revenue Canada

To the casual observer, Le Hibou seemed a roaring success. Large line ups for the likes of such performers as Gord Lightfoot, Pauline Julien, Joni Mitchell or B.B. King. But they were the exception. Generally, we did well on some, on others we would break even, and many times we would lose on shows. I never felt at any time that we had a comfortable financial cushion. It was always touch and go. We did not have a liquor licence and relied entirely on entry fees and food to pay costs.

At one time our landlord, the NCC, informed us that all the rents had to be increased since they had received complaints from the private sector implying that rents were too low. They were of course referring to beautifully renovated lofts on Sussex Drive rented at ridiculously low rents, apparently to good friends of the government. Those were the rumours. In any case, Le Hibou was part of the lot. I met with Mr. McLelland, the NCC property manager, and showed him the financial statements of the past years, some with break even points but more with losses rather than gains. He discussed our position with his bosses, and they agreed not to increase our rent. Perhaps they considered Le Hibou as part of their long range plan to develop Sussex Drive from a run down street to a vibrant people-oriented venue. If so, it worked in our favour.

Another government arm also became interested in Le Hibou, or more specifically my relationship to Le Hibou—Revenue Canada. Year after year, I would deduct on my personal income return losses incurred by Le Hibou . I would also declare as a deduction one-fifth of household expenses (rent, electricity, heat , telephone) since I used one room as an office for Le Hibou to do the management, the buying, the publicity, the bookings of artists, and at times the booking hotels for them. So one day I received a call from Revenue Canada. They wanted to have the books of Le Hibou for the last five years. Fortunately for Le Hibou and me, my mother-in-law had graciously offered to do our bookkeeping for free, a most difficult task because I was not always as diligent as I could be in the management of receipts.

My mother-in-law, Ethel Knight (Penny and Alan’s mother), worked for the federal government for Supply and Services and was a one of their top purchasing agents. Anything the government would buy, Ethel wrote up the contract, be it airplanes to office furniture. (I recall that six months before the opening of Expo 67, Ethel with a few other purchasing agents were sent to Montreal to solve a crisis. Expo 67 were running towards a catastrophe. They were so behind that Expo would open with a site half finished. Luckily, the intervention of the federal government purchasing agents prevented a diplomatic embarrassment.) Ethel applied her meticulous skills to make sense of our scattered and casual handling of receipts. Since Ethel occasionally had bouts of insomnia, she would divide her time working on the books or studying her stock portfolio, which she handled with great adroitness. On many evenings she was kept up by neighbourhood disturbances. Philomène TerraceShe lived at 366 Daly and directly in front in the Philomène Terrace (now designated heritage), a beautiful, late 18th century, row of stone row houses where the Akroyd family lived. Dan Akroyd, their son was there, and for him it seemed that party time was anytime. Ethel was never a fan of his disruptions and antics. To her, he was just a nuisance and not funny at all.

One morning, at the appointed time, I received the visit of a Revenue Canada auditor to pick up the boxes of receipts, which were all in order, marked by the day and month, and held by rubber bands. Before he took the boxes, he glanced about the room, looking quizzically at my secondhand furniture and our antique tiger-striped oak round dining room table, a gift from Penny’s grandmother. He asked me if the second-hand beat up Volkswagen bus I had outside was my only car; it was. Satisfied, he took the boxes and left. I was told that when Revenue Canada would do an audit it was because they firmly believed that something was askew. Three months later, he returned the boxes and stated sheepishly that everything was in order, and that the books were particularly well kept. And of course I knew that, and so did Ethel.

But I was not quite finished with Revenue Canada or rather, the other way around. Some years later I received a letter informing me that all American performers had to pay income tax in Canada. Whenever I had artists from the United States, I would call up my official contact at Revenue Canada who looked after incoming performers. He quizzed me on their contract fee, their duration of stay, and the number of people involved. He would inform me that considering their low fee they didn’t need to pay anything. I would religiously call him every time and always give him the particulars on any outside performer or performers. A few years later I received a letter from a Revenue Canada auditor stating that they had reviewed our file and that we owed them over $6,000. I was shocked of course and immediately called my contact at Revenue. He was most apologetic and stated that the auditors saw things differently and they had the last word. He suggested to come and meet his boss, that perhaps something could be done. Assuming that two people representing Le Hibou would be beneficial, I asked Harvey to be there as well. It was quite the experience. We were at their mercy and they knew it. We went to my contact official’s immediate boss and needless to say, he was more than embarrassed. My contact’s boss gravely looked at the documents, asked a few questions, grunted a bit, and said perhaps so and so should have a look at this.

So we trundled off with the original contact sheepishly in tow to a higher floor, a bigger office and an even bigger boss. More grave looks, and more impressive grunts followed by another suggestion to see another boss. So off we went into another office, bigger again than the last one. Since all had trouped from one office to the next, the party was getting larger, and they had a very animated discussion using a vocabulary that I could not understand. Finally, they said they would review it, and let us know later. I was relieved that they decided not to go to the Minister. Later I received a letter stating that the amount was reduced by a third with the suggestion that the monies could be retrieved from the agents. Without great expectations, I sent letters to all the agents explaining the situation and stating the amount owed. Many never bothered to reply, and those who did commiserated with me, but could not do anything since it occurred some time ago. So I had to pay , and did so by sending monthly cheques to Revenue Canada. I often wondered if our location was a curse—there was a Revenue Canada building directly across the street from us. But that was not the building we had gone to, the auditors were in another building. I always thought that perhaps had we been in Moose Jaw, or Corner Brook, Newfoundland, perhaps I would never have heard from Revenue Canada.

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