Canadian Manufacturing

Canada’s red tape horror stories

Small businesses seeing red over regulations

OTTAWA—When Claude Lavoie took over his father’s small furniture manufacturing company, he decided to move the business from Gatineau, Que. to Ottawa.

Lavoie wanted to get away from what he calls “an anti-business environment” in Quebec.

But the owner of Meniuserie Gaston Lavoie Cabinet Shop Ltd. says he’s now facing the same regulatory hurdles in Ontario as those he left behind.

Between Statistics Canada surveys, Canada Revenue Agency phone calls, and new health and safety planning, Lavoie says business days are getting longer and he’s getting more stressed out.

His is just one of several stories from small business owners across Canada who claim federal, provincial and even municipal red tape is hurting profits.

The Canadian Federation of Independent Business has published their submissions online to promote its Red Tape Awareness Week.

Inefficient regulation is keeping owners from building their businesses, creating jobs and expanding the economy, it says.

The CFIB estimates that regulation costs Canadian businesses $30 billion each year in compliance costs alone—with small firms feeling the brunt of it.

Companies with more than 100 employees pay an annual average of $1,117 per worker to comply with regulation while businesses with zero to four workers spend 5,825, according to the CFIB.

CFIB president and CEO Catherine Swift says at least a quarter of that burden could be reduced without hurting regulatory objectives, such as health and safety.

“This is the equivalent of a $7.5 billion annual stimulus package. It’s time for Canadians to demand that governments take this issue seriously,” Swift says.

The CFIB will be rolling out other initiatives for Red Tape Awareness week. Tomorrow, it launches an online province-by-province report card.

Has red tape affected your business? Tell us about it.

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