Winnipeg city councillor Al Golden has been found guilty on two of four income tax charges.
Golden was found guilty of filing a false statement on his 1989 return and for failing to declare $727,000 in income.
Golden has been on trial for the past three weeks on charges relating to his tax returns from 1989, '90 and '91.
The Canada customs and revenue agency said Golden had failed to report income from four businesses in excess of a million dollars and that he owed almost $300,000 in back taxes.
Golden's lawyers argued he was a victim of a personal grudge in the pursuit of these charges.
The maximum penalty for the charges is a five-year jail term or a fine equal to about double the amount of taxes owed.
He will also lose his seat on city council.
Mayor Glen Murray says because of the conviction, the City of Winnipeg Act requires Golden to resign as soon as he is sentenced next month.
Murray says the city will then have to call a byelection.
He says there is no law preventing Golden from running for his seat again.