By Janine Halbesma
For the news:
October 19 to 25 is Small Business Week all across Canada. Since 1981, there has been a week in October set aside to celebrate the important contributions of entrepreneurs.
And their contributions are significant: They create jobs, provide valuable and interesting goods and services, and generously donate to community and charitable causes. In fact, the small- and medium-sized business community employs six out of 10 Canadians and contributes almost half of our country’s gross domestic product.
But running a business is not easy.
According to the Canadian Federation of Independent Business the top business issue in central Alberta is still the labour shortage. Imagine the challenges of trying to serve customers and grow a business when there just are not enough workers.
It’s not an easy problem to fix either. The solution involves all levels of government, education institutions, business owners and employees. There has been some progress though. As part of the solution, our federal and provincial governments have placed a more concerted effort on immigration reform over the past few years, and it’s beginning to take some of the pressure off.
The tax load on small businesses is a significant issue, too. It’s not just federal and provincial corporate income tax. At the federal level there are also Employment Insurance premiums, Canada Pension Plan premiums, customs and excise taxes, among other levies. At the provincial level there are royalties, workers’ compensation premiums, permits and licence fees. At the municipal level there are property taxes, franchise and local access fees, and additional permits and licences.
But that’s not all. A recent study by CFIB found that the cost for businesses to comply with their tax obligations is $12.6 billion each year. This is money spent on hiring accountants, lawyers and tax advisors, employee time dedicated to tax compliance and audits, storage, filing, and so on. It’s an extra cost on top of the actual tax bill.
It is also only one part of the total regulatory burden business owners have to deal with. Some regulations are absolutely necessary for a safe and fair society. But small business owners get frustrated with excessive red tape, paper burden and poor service when dealing with government.
Many governments in Canada are starting to recognize this problem and are taking steps to reduce the burden. In 2001, British Columbia counted all their regulatory requirements and found they had nearly 400,000. In three years, they reduced the burden by nearly 40 per cent. Nova Scotia took a slightly different approach to measuring the overall burden, by counting how long it was taking to comply with all provincial forms and paperwork each year, and found it took 615,000 hours. They have set a 20 per cent reduction target and recently announced that they are almost half way to achieving it.
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Alberta hasn’t even take the first step of measuring the overall burden, let alone setting a target to reduce it. But they should. CFIB did a rough count and we found there are nearly 30,000 pages of acts and regulations in Alberta and not all of them are necessary. Here are some of the dumb rules CFIB has heard about in the past year:
ßMechanics required to use specific tools for vehicle inspections.
ßTruck drivers obligated to fill out extensive logs to track mileage.
ßDay-care owners told to consider more restrictive worker-children ratios.
ßTobacco retailers directed on the precise font size they must use on indoor signage.
Here’s the amazing part: With all the challenges dealing with labour shortages, the tax burden and red tape, small business owners do it anyway. So to each small business owner, thank you. Thank you for contribution to central Alberta, the province and the country.
Janine Halbesma is the senior policy analyst with the Canadian Federation of Independent Business. She can be reached at janine.halbesma@cfib.ca.