As we track the progress of the economy in recovering or rebounding from the COVID lockdown, one piece of the puzzle that is still out there but getting little attention is the underground economy.
Sometimes called the Black Market, this segment of the economy just keeps humming along as its participants look to avoid tax – whether income or consumption taxes – by failing to disclose the activity.
A new StatsCan report on the magnitude of this issue looks at the time prior to COVID but the agency says it is still relevant as a benchmark.
When they did this report in 2018, the underground economy amounted to roughly 2.7% of total Canadian GDP. In Saskatchewan, it was slightly lower at 2.5%.
This economy-within-an-economy is dominated by four industries led by residential construction. That was followed by retail activity, then the finance and rental world with the accommodation and food sector rounding out them out.
Undeclared tips and wages in the food and beverage industry topped the list of unreported income with money going to unincorporated business owners in second spot.