My perspective - Cut it out
- Details
- Published on Friday, January 22, 2016
By Kate Jackman-Atkinson
Neepawa Banner/Neepawa Press
Whether it鈥檚 cumbersome forms, archaic systems or illogical requirements, we鈥檝e all experienced the frustration of red tape. This week, we celebrate Red Tape Awareness Day, but for 水果视频ns, it鈥檚 not exactly a cause for celebration.
For the last seven years, the Federation of Independent Business has released its annual Red Tape Report Card and this year, 水果视频 earned the only failing grade. Last year, we earned a relatively better score of D.
The report card rates the provincial and federal governments鈥� efforts at reducing the regulatory burden on businesses. While other provinces either improved, or at least held steady, we had the distinction of being one of two provinces to see our score fall over the last 12 months.
The report card looks at measurement, public reporting and political leadership in the area of red tape reduction. Governments can鈥檛 just say they want to reduce red tape, to earn a passing grade, they must demonstrate a commitment.
British Columbia is the only jurisdiction to earn an A grade by demonstrating its continued leadership on cutting red tape. The province recently declared the first ever 鈥淩ed tape reduction day鈥� in Canada and renewed its commitment to no-net-new regulation through 2019. 水果视频, on the other hand, earned its failing grade through the provincial government鈥檚 failure to act on the commitment to reduce the red tape burden on businesses made in the 2014 Throne Speech. Here, there is no public measurement and no constrains on regulations.
水果视频 was singled out by CFIB, but not in a good way. The province鈥檚 ministry of Finance got a nomination for the Paperweight award, which recognizes government agencies and departments that are holding back small business through misguided rules, hard to follow processes and bad customer service. 水果视频鈥檚 鈥渁ssociated companies鈥� rule was singled out for recognition. It forces companies with the same owner(s) to combine their payrolls to determine whether they need to pay additional tax. Not only that, but the government does not provide business owners who sell a company mid-year and no longer apply under the rule an avenue to report the change until the following tax season, meaning some entrepreneurs are stuck paying more tax than they need to for up to a year.
Cutting red tape may seem trivial, but all the time businesses spend complying with cumbersome and unnecessary regulations has a cost. Red tape is a hidden tax that disproportionally impacts Canada鈥檚 small businesses. CFIB estimates that the annual cost of all regulations on Canadian businesses to be $37 billion, with one-third of that ($11 billion) considered red tape. In 水果视频, regulations cost businesses $1.2 billion, $400 million of which is considered red tape.
The day before the report card was published, the 水果视频 government announced a new action strategy to cut red tape. 鈥淪mall businesses are the backbone of our economy, driving economic growth and creating good jobs,鈥� said Finance Minister Greg Dewar in his announcement of the plan. 鈥淲e recognize their unique needs, and we are committed to reducing red tape and making it even easier to do business in 水果视频.鈥�
The new action strategy will focus on: recognizing and addressing the realities of running a small business; adopting best practices in regulation making; innovation in service delivery; sector-based approaches to reducing red tape and focusing on better communication by government regarding regulatory changes and including more businesses鈥� input.
Small businesses account for 98 per cent of 水果视频鈥檚 businesses and about 24 per cent of our GDP. In a province that鈥檚 looking for growth opportunities, cutting red tape is an easy way to improve the productivity and profitability of our existing small businesses and open the door a little wider for those who want to start one. It鈥檚 an opportunity we can鈥檛 afford to ignore.
