On April 29, 2015, Statistics Canada released new underground economy estimates for Canada from 1992 – 2012. Estimates include trends in underground economy activities for different industry sectors at the national, provincial and territorial levels. These estimates will help the CRA understand the size and nature of the underground economy and the necessary measures to combat it.
Estimates show that in 2012 total underground activity in Canada was estimated at $42.4 billion, which is equivalent to 2.3% of the GDP. Research shows that underground economy activity is the most prevalent in sectors where cash transactions are common. In 2012, four sectors accounted for 66% of the total estimated underground economy: residential construction (28%); finance, insurance, real estate, rental, leasing and holding companies (14%); retail trade (12%); and accommodation and food services (12%).
The study shows encouraging signs that the underground economy did not grow as quickly as the total economy; from 2007 – 2012 underground activity increased by 14%, compared to GDP at 17%. While estimates indicate that the underground economy is growing at a slower pace than the Canadian economy, the Government of Canada continues to enact measures to combat fraudulent activity.
For more information on the underground economy study and CRA combat measures, visit the full article here.