According to the Small Business Association (SBA), federal regulations cost small businesses more than larger businesses. In the SBA’s study, “The Impact of Regulatory Costs on Small Firms,” four areas were looked at when comparing cost burdens on businesses: economic, tax compliance, OSHHS (occupational safety and health and homeland security), and environmental.
BusinessNewsDaily.com highlights some troubling statistics:
“Small businesses still face higher costs when they encounter government regulations compared to larger firms,” said Winslow Sargeant, chief counsel for the Office of Advocacy. “Today’s report shows that on a per employee basis it costs small firms $2,830 more than larger firms to comply with government regulations. That’s 36 percent difference and that is an unfair burden to place on American small business.”
The findings in this report are illuminating because most of the costs of regulation compliance are hidden, unlike direct taxes such as a sales tax.