Tax evasion involves deliberately ignoring a specific part of the law. A major source of tax evasion is the failure of individuals and businesses to report certain economic activities in order to avoid paying all the income tax they owe.

For example, individuals who deliberately conceal income (or businesses that deliberately conceal part of their sales) in order to pay less income tax are engaging in tax evasion. Workers in the underground economy and businesses that fraudulently claim tax refunds are also committing tax evasion.

Certain sectors, such as the construction and restaurant sectors, are particularly affected by tax evasion and the underground economy. However, the unlawful sale of tobacco products and fraudulent activities in the real estate and investment sectors are also identified as major sources of tax evasion.

Moreover, some individuals and businesses skirt their tax obligations by using tax shelters or planning strategies that do not respect the spirit of the law. 

The consequences of tax evasion and the underground economy

• The government sustains enormous revenue losses.
  These losses directly affect the government's capacity to provide services and fund programs that meet the needs of our ever-changing society. 
• Businesses face unfair competition.
  Businesses that fulfill their tax obligations face unfair competition from those that do not.