Despite the paper trail, local details of audits I know of, indicated that workers still underreport.

https://www.google.com/url?sa=i&source=web&cd=&ved=2ahUKEwjA...

Anecdotally, it remains true.

Tips don’t go on the official pay reports that go to the Canadian government since it isn’t actually employment income paid by the employer.

Why would sales taxes be inconsequential?

I guess because you're only not paying sales tax on the tip portion of the payment - so if the sales tax is say 10%, your bill was a $100 and you left a $10 tip, you're only saving $1 on the sales tax.

And if that mere dollar would influence you on whether or not you were going to go to the restaurant, you probably shouldn't have ever been going to the restaurant.

It still means an industry is paying ~85% of the sales taxes it should.

Overall, businesses will charge what they can. And if they don’t have to pay taxes, they can keep that $ for themselves.