News
Small biz to Gov: Ten red tape-trimming targets

January 27, 2010 By Amanda Ryder

Jan. 27, 2010 – Recently, the Canadian Federation of Independent Business held it's first ever Red Tape Awareness Week. They've specified 10 areas that governments need to address to lighten the red tape load.

Recently, the Canadian Federation of Independent Business held it's
first ever Red Tape Awareness Week. As a result of this week, the CFIB is proposing
ten specific areas for governments to work on in 2010 that will lighten
the $30 billion annual load for Canada’s businesses.

According to CFIB’s latest report, 81 per cent of small businesses
believe that government does not consider the impact on business when
it regulates. “Making progress on the list below would go a long way
towards demonstrating that government values the critical contribution
that small businesses make to Canada. It’s not comprehensive, but it is
a good start,” said CFIB’s vice-president of national affairs, Corinne
Pohlmann.

Create a GST/HST Taxpayer Fairness Code – Canada
Revenue Agency (CRA) should adopt a GST/HST Taxpayer Fairness Code.
Complying with sales tax rules is the top frustration of small business
owners. Businesses collect sales tax revenue on behalf of government
and deserve good customer service, including clear answers to questions
in a timely manner. The Tax Fairness Code should be modeled after BC’s
code where business owners have the right to get questions answered in
writing and any written government tax advice will be respected even if
it is wrong. Taxpayers need to trust that if they have followed
guidance provided by CRA officials, they will not be penalized.
Create consistent definitions of employee and contractor status
– Provincial and Federal Governments should work together to have one
clear definition and ruling process to determine whether someone is
considered an employee or a contractor. Conflicting definitions between
CRA and provincial employment standards and workers compensation create
a major regulatory headache for many small business owners. Simplifying
this would save business owners thousands of hours of work and needless
frustration.
Simplify compliance for Automobile Expense Deductions
– Finance and Canada Revenue Agency should simplify compliance for the
Automobile Expense Deduction since maintaining a detailed logbook is
the most burdensome part of the motor vehicle tax provisions for small
business owners. In Budget 2008, the federal government committed to
work towards allowing a logbook to be used for a sample period of time
as representative of how a vehicle is used. Some progress has been made
to explore this, but nothing has been implemented.
Make Safety Management Systems (SMS) in the Aviation Industry small-business friendly
– Transport Canada should create workable Safety Management Systems
(SMS) in Canada’s Aviation Industry for smaller operators. SMS shifts
the method of regulating safety from Transport Canada to the companies
themselves by imposing a large management framework that is supposed to
create a “culture of safety”. The problem is that the SMS framework was
designed for large aviation firms, such as airlines, which have been
implementing it over the last four years. Soon these same rules will
apply to smaller aviation businesses such as float plane operators,
crop dusters and those that service the industry. Many long standing
businesses may go out of business as a result of these unworkable
rules. Expecting smaller companies to implement a structured management
system and provide ongoing reporting will likely do very little to
actually enhance airline safety.
Introduce a single business license for mobile businesses
– Municipal governments should allow businesses that work in multiple
municipalities, like plumbers and other contractors, to have a single
business license. It’s not uncommon for businesses that have to work in
multiple municipalities to be required to get up to a dozen different
business licenses. The Victoria region and the Okanagan-Similkameen
regions in BC have introduced a single business license for mobile
businesses. According to one business owner in Victoria, the system has
saved him the better part of a week. Revenues and compliance have gone
up in both regions.
Sign on to BizPal (municipalities that have not done so already)
– BizPal is a partnership between the Federal government and
participating Provinces and Municipalities. It is a program that allows
businesses to do one search for all of the required permits and
licenses to open a business. It reduces search time dramatically. The
time required to find permits to open a restaurant in one municipality
went from seven and a half hours down to 15 minutes.
Bring fairness and accountability to the Canadian Food Inspection Agency (CFIA)
– Agri-business owners understand that a certain amount of regulation
is important for food safety, but the CFIA could significantly improve
the way it interacts with small businesses. A recent small business
report card on CFIA found that fairness is lacking and many feel they
have no recourse when dealing with CFIA authorities. A Food Producers’
Ombudsman with real powers to oversee how CFIA interacts with small
businesses should be appointed.
Simplify the customs process – Canada Border
Services Agency (CBSA) should reform the Duty Drawback program.
Claiming customs duty refunds imposes such onerous paperwork burden on
Canadian firms that many smaller firms who import and export are
forfeiting money owed to them or choosing to operate in the US rather
than in Canada. One farmer has to fill out 400 forms for every
container imported. His paperwork then has to be stored for seven
years. The government should eliminate unnecessary duties and reduce
record retention requirements for remaining duties.
Simplify the Labour Market Opinion Process in Hiring Temporary Foreign Workers
–There have been several positive changes to the Labour Market Opinion
(LMO) and Temporary Foreign Worker (TFW) systems, but many firms are
still frustrated by the LMO process. A positive LMO is required before
an employer can hire a TFW. The LMO is supposed to assess an employer’s
efforts to hire Canadians and ensure adequate wages and working
conditions for the TFW. Further simplification by Human Resources and
Skills Development Canada (HRSDC) of these rules is desperately needed
(E.g. allowing renewals of LMOs without having to repeat the entire
process and extending the expedited LMO pilot to all regions of
Canada).
Create accountability surrounding government fees –
The federal government should implement Bill C-212, the Cost Recovery
Bill (An Act respecting User Fees). Bill C-12 was passed with support
from all parties in 2003. It is supposed to promote competitiveness and
innovation in Canada by ensuring that fees are reasonable, linked to a
service provided, and transparent to those that pay. Bill C-212 is
legislation, but has never been implemented.