Regulation costs businesses $37B a year: CFIB

The business group says red tape deterring next generation of Canadian entrepreneurs.

January 21, 2015   by PLANT STAFF

Small businesses say the costs associated with regulation are rising.

Small businesses say the costs associated with regulation are rising.

TORONTO — Regulation is costing small Canadian businesses more time and money than in 2012, according to the Red Tape Report by Canadian Federation of Independent Business (CFIB).

The report notes companies spent $37.1 billion on regulation in 2014, up from $31.7 billion in 2012, and spent an average of 842 hours a year complying with government rules and paperwork, an increase of 12%.

Regulation is also costing small businesses significantly more than their US counterparts, with the greatest gap among companies fewer than five employees, which pay 58% per employee ($6,683) than in the US ($4,240).

Company owners say that regulation could be cut by about 30%, or $11 billion a year, with no negative effect on important health, safety and environmental objectives of regulation. The savings would translate to 4.5 hours a week of extra time for the average business.

But the report raises troubling ramifications for the future. Forty-two per cent of small business owners would not advise their children to start a business given the burden of regulation.

Click here for a cop of the report.

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1 Comment » for Regulation costs businesses $37B a year: CFIB
  1. Rod Paterson says:

    A significant percentage of the cost of regulatory compliance is simply knowing what regulations apply to our businesses and continually searching for amendments to those regulations. Ignorance of the law is no excuse however, it could be made much easier for us to be less ignorant. We knew that we were compliant with the Transportation of Dangerous Goods Regulations in 2013. It would be nice to have a government site that listed amendments to the TDG regs that came into effect during 2014 that I could scroll through looking for changes relevant to my business. Extend this to all federal, provincial and municipal regulations and we would be able to comply affordably. We would save us thousands in time and consultant fees.

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