Greenhouse Canada

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

  1. 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. 
  2. 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
  3. 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.
  4. 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. 
  5. 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. 
  6. 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.
  7. 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. 
  8. 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. 
  9. 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
  10. 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.


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