More and more contractors I talk to are planning to work for cash, or to set up barter systems, or find other methods of avoiding punitive government fees and taxes. The WSIB money grab in Ontario is possibly the last straw for many formerly law-abiding, legit contractors.
February 19, 2013 by Alec Caldwell
The feedback we are receiving right now from home renovators on this new mandatory WSIB in Ontario says that it will be like rocket fuel to the underground market.
One anonymous contractor (not a member of CARAHS) recently told me that he is part of a network of other self-employed contractors who are planning to use a lot more cash when they are working together. And they are going to increase their barter system. All to circumvent added WSIB expenses.
Another contractor told me that he asked two of his best sub-trades in electrical and plumbing to now register for WSIB. They both refused. So what does he do? They say they will not accept any holdbacks of WSIB premiums from their jobs. Does this mean the contractors will now have to pay the WSIB himself and take the loss or try to factor this into his pricing? How will increasing his pricing help him in today’s market, especially in a tight economy?
Many of you reading this will say that he needs to find other contractors to work with. But how easy is it to find reliable people or give up on relationships you’ve taken years to cultivate?
As I said in my last column about Working for Cash, in my opinion homeowners are the main driving force behind the cash economy. We got a lot of response to this. Some agreed that homeowners are to blame. Some said it was the government’s original mistake that caused the problem. Others said that, regardless of who is to blame, it puts a blemish on any industry when businesses are willing to play along with illegal tax avoidance.
But in the end, I believe that people will always find excuses to circumvent laws – or taxes – that they see as unjust and unfair.
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