Regulation High Cost To Small Business

Regulation costs small businesses $38.8 billion annually, roughly 30 per cent ($10.8 billion) of which can be considered unnecessary, redundant, or overly burdensome regulation or red tape, says the Canadian Federation of Independent Business (CFIB)'s ‘Canada's Red Tape Report.’ The report, released in partnership with Intuit Canada, launches its ‘12th annual Red Tape Awareness Week.’ Businesses with fewer than five employees spend $7,023 per employee to comply with government regulation, while businesses with 100 or more spend $1,237 per employee. "COVID-19 has battered the economy and hammered Main Street. As we look towards recovery, reducing red tape is a win-win – it's a low-cost way for government to stimulate the economy while still protecting needed regulation," says Laura Jones, CFIB's executive vice-president. Ninety-four per cent of small businesses say it is important their federal and provincial governments are committed to reducing red tape, but far fewer are confident governments are committed to reducing red tape (15 per cent are confident federally, 24 per cent provincially). The report highlights ways governments can reduce red tape including simplifying existing regulation and using plain language (79 per cent), and improving government customer service (68 per cent). Eighty-one per cent agree better online government services have the potential to significantly reduce compliance costs. One specific example cited is allowing businesses to submit compliance forms through software their business is already using.