Alert to small business regarding MMBC

How new taxes from Multi Material BC could affect your business.

You likely have no idea what Multi Material BC (MMBC) is and that is completely understandable. Regarding MMBC the Canadian Federation of Independent Business’s (CFIB) January newsletter to all members stated, “Small business owners were outraged after receiving letters threatening $200,000 fines for non-compliance with new regulations they had never even heard of, and still do not understand to this day.”

In my articles for our Kootenay Business magazine I try to avoid information that relates only to our own publishing business, because our readers are entrepreneurs, employees and members of  the general public interested in or associated with small businesses. As I worked with CFIB to try and make sense of how the correspondence we were getting from MMBC affected us, I became aware that the implications of this new program were huge and would not just affect our segment of the business economy but would end up affecting, either directly or indirectly, all residents of B.C.

Last summer we received our first correspondence from MMBC. It was poorly written and appeared mass-produced, and threatened us to apply through them to be part of a province-wide recycling program for printed materials. It appeared to me to be a scam.

The correspondence then became more threatening and seemed to suggest there was an affiliation with the B.C. government. I contacted CFIB and received the following letter dated September 18, 2013, so was still not overly concerned about the situation.

Dear CFIB member,
Thank you for contacting us with your concerns about Multi Material BC (MMBC). As you are aware, your feedback determines CFIB’s message to government. Over the past few months we have heard from many members regarding Multi Material BC’s recycling stewardship plan. We are currently in discussions with the Minister of the Environment and MMBC in order to protect the interests of small businesses, to minimize the reporting requirements and schedules, and to raise the threshold below which small businesses are exempt from some or all of these obligations. As the situation progresses we will be reaching out to you with new information and outcomes.
Sincerely, Katherine Day

I worked through the situation with CFIB and had correspondence with them in November and again in February, and had phone discussions during that same period. I realized this was not going to go away, but it was not until the beginning of the current year that the newsletters from CFIB became stronger on the enormity of the situation and that this whole philosophy of recycling responsibility was becoming very serious for everyone. I am going to give you excerpts from CFIB’s newsletters and an article they have produced to best explain how this situation developed. I will put all their information in italics.

The whole problem began with the B.C. government developing a new extended producer responsibility (EPR) program that CFIB explains this way:

EPR programs are premised on the idea that financial responsibility for recycling materials should be borne by those businesses responsible for producing and/or importing goods. While CFIB has not taken a position on EPR itself, the MMBC experience shows how good intentions with public policy can go horribly wrong. Some businesses may be forced to close their doors, with other businesses forced to absorb significant costs for new fees imposed by MMBC or, more likely, passing them on to their customers.

In small towns, community newspapers and local recycling depots are at risk of going out of business thanks to the new policy. B.C.’s newspaper industry is facing $14 million of additional taxes. They will be paying 4,762 per cent (that’s not a typo) more per kilogram of waste than the equivalent program in Ontario.

The regulations take effect May 19, 2014, despite the fact that the vast majority of B.C. businesses have either no idea the regulation exists, or how it will affect them. The B.C. government has put forward a costly and ill-considered plan that will harm B.C. businesses and their employees, yet provide no social benefit by reducing waste.

I became aware that this was not just for print material recycling when a newsletter from CFIB had this information:

For more information on the latest EPR recycling proposals, please visit the following links:

Last week, a coalition of B.C.-based businesses representing agriculture, newspapers, landscaping, manufacturing, retail, wholesale, food and waste collection sectors held a press conference to announce a RethinkItBC campaign to fight the new rules.

To show how seriously wrong this whole program has become I have included an excerpt showing CFIB’s feelings on it:

On Friday, January 31, the last day of Red Tape Awareness Week, MMBC was given our new Paperweight Award. CFIB is giving this dubious honour to those in government (and some in arms-length quasi-governmental agencies) who have made life more difficult for small business owners with excessive red tape. As far as small business is concerned, MMBC is the worst of the worst: see full article

So the above explains why I have written this article, hopefully giving a few more entrepreneurs in the Kootenays an alert to find out more about how these programs will affect them. It is disappointing that a person has to find out how new taxes affect you from an independent source like CFIB instead of directly from the government that is implementing them.

 —Lou Rogers is a CPA, CA and chair of Koocanusa Publications Inc.

Lou Rogers

Lou Rogers is a chartered accountant and chair of Koocanusa Publications Inc. He obtained his degree as a CA in 1965 and spent the next 25 years in public practice in Cranbrook, B.C., retiring in 1990. View all of Lou Rogers’ articles

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