If I buy a chair from my neighbors and he does not declare the income and I pay no tax, is this a black market? What kind of market is this?
If I buy a chair from my neighbors and he does not declare the income and I pay no tax, is this a black market? What kind of market is this?
Answer: Informal Market.
When it comes to income and taxation, there is a lot more grey than you think.
Technically, ALL income for business-earning purposes should be reported and taxed accordingly.
Regarding taxation of the buyer, at least in Canada, GST is generally not applicable until the seller is earning $30K+.
But REALISTICALLY - no taxation agency really cares about 1 chair.
I probably wouldn’t consider it a black market/underground economy unless it was significant and ongoing. E.g., your neighbours REGULARLY sell chairs for profit and don’t report their earnings.
I'm not a lawyer but maybe grey market?
Neighborly market?