After an eight-month awareness campaign about electronic suppression of sales software, new monetary penalties and criminal offences under the Excise Tax Act and Income Tax Act will come into effect in September.
Revenue Minister Kerry-Lynne Findlay said during a stop in Saskatoon on Wednesday that small and medium-sized businesses are the economic drivers of Canada.
She says the underground economy does give an unfair advantage to those who show a lack of respect for Canada's tax laws.
ESS software or "zapper" software selectively deletes or changes sales transactions in point-of sale-systems like cash registers and business accounting systems.
That means there is no record of the original transaction and the business is able to under-report their revenue and avoid paying the full share of their GST, HST and income taxes.
Findlay was in Saskatoon to speak with members of the business community about the ESS software and to remind business owners about the new consequences for trying to skirt the system.
Businesses who use or possess the software face a fine of $5,000 initially and $50,000 on any following infraction.