Most small and medium enterprises (SME) perceive tax and local government regulations as the most burdensome in terms of regulatory compliance, according to the results of a recent survey conducted by the Asian Institute of Management (AIM).

The survey found that for SME, regulatory compliance was, on average, perceived to be “moderately burdensome,” with the Bureau of Internal Revenue (BIR) and local government units (LGU) seen as among the most difficult agencies to deal with.

More than half of SME (52 percent) reported regulatory compliance as a concern “as soon as the business was being established,” according to the outcome of the survey on “Cost of Regulatory Compliance for Small and Medium Enterprises in the Philippines.”

“BIR registration and fulfillment of local government requirements such as business permits, fire safety inspection clearance, payment of local business taxes, occupancy and building permits were considered as some of the most burdensome when SME were starting,” said the paper.

The AIM survey covered a total of 590 SME in Metro Manila, Cebu and Davao and was conducted from August to October 2019. The findings were presented last month by Jamil Paolo Francisco, executive director of AIM Rizalino Navarro Policy Center for Competitiveness (AIM RSN PCC), and Georgina Gonzales, a consultant for AIM RSN PCC.

Meanwhile, cited as the most burdensome agencies by SME in general were the BIR in first place, followed by the Department of Trade and Industry, LGU and Department of Labor and Employment.

On the most burdensome regulatory level, most SME “spent more time complying with local than with national regulations.”

Tax-related regulations were perceived as the most burdensome by SME (more than 80 percent) among classes of regulations, followed by building-related, workplace safety-related and healthcare and insurance regulations.