Let’s talk cash economyCanadian Contractor Marketing & Sales Permits & Legal Business cash economy renovations
I recently hired a contractor to do some work that I couldn't get to. His price was fair, but leaves me reeling at what the legitimate costs of a reno has become.
I am having some work done on my house by a real, above board contractor. I started the work, but gave up because of time constraints. The material costs are about $2,000, which would have been my cost had I done the work. In the end, the work will now cost me about $7,500 plus HST.
That’s a lot of money, especially when I know the work is very straightforward (insulation, drywall, tape, paint, a bit of wiring). But I know the price is fair. The contractor I am using even publishes the cost of his WSIB separately on his invoices, like showing the tax charges on a gas pump (smart move, by the way- you should do it). I know that’s just how much it costs.
Which makes me also understand why the cash economy is so prevalent. Make no mistake, it would have been VERY easy for me to get the same work done for cash and I might be paying $4,000 instead of $8,000.
In the end, I can afford to get the work done legitimately. My wife and I are classic DINKS (double income, no kids) with good jobs and a small mortgage. But struggling families with big mortgages? And kids needing braces? Or a one income family? The temptation to do cash would be overwhelming and, frankly, I would have a hard time finding fault with their choosing a cash contractor. Would YOU?
Fighting the cash economy is an extremely serious problem for the residential construction business and all we get from government is more regulation and more costs and more distance between the legitimate economy and the cash economy.
What do you think is a solution that we can actually lobby for? How do we frame the arguments for a better system so someone in authority will listen? I’ll provide some of my ideas in my next blog, but I hope I will get some ideas from you as well.