Inter-municipal Business Licences
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Inter-municipal Business Licences
Full Report
September 2007
Matthew Armstrong, Economist, Western Canada
Business licences typically account for less than one per cent of municipal revenues, but can add significant costs to businesses, particularly mobile tradespeople. Inter-municipal business licences represent a low-cost opportunity to reduce the amount of red tape on businesses in Canada.
Introduction
Dealing with regulatory requirements is a major component of operating a business, especially for small- and medium-sized enterprises. In 2005, the Canadian Federation of Independent Business (CFIB) released a major report highlighting the level of regulatory burden on Canadian businesses in a report titled Rated R: Prosperity Restricted by Red Tape. As part of the report, the annual compliance cost for dealing with regulations in Canada was conservatively estimated to be $33 billion. This includes regulations imposed by all three levels of government – federal, provincial, and municipal.
Traditionally, any firm wishing to conduct business across municipalities within a province or territory has had to purchase multiple business licences, one for each local jurisdiction. While the level of regulatory burden is already high for firms operating out of a single location, for mobile tradespeople the simple act of licencing creates an additional amount of regulation that uses up valuable time and resources in order to be compliant. However, some municipalities have simplified regulatory requirements through the issuing of common business licences, allowing the holder to conduct business across multiple jurisdictions. For example, in 2000, B.C.’s Capital Region Disctrict (CRD) introduced the Inter-municipal Business Licence, permitting the holder to operate within all 12 participating municipalities for a standard fee. The only province or territory that currently employs an inter-municipal licence is the Yukon Territory, which has had a system in place since 1985.
