Uber, Airbnb here to stay so get rules in place, Ontario Chamber of Commerce says
Solve insurance gaps and set stage for new businesses, chamber of commerce urges province, federal government
The Ontario Chamber of Commerce is urging the province and the federal government to get legislation in place to handle the sharing economy and head off conflict over services such as Uber and Airbnb.
In a report released Tuesday morning, the business lobby group called for "innovative thinking" to handle problems like gaps in insurance coverage and tax compliance.
Chamber of Commerce CEO Allan O'Dette hailed the economic opportunity presented by ride-sharing services such as Uber, saying Ontario could be ahead of other jurisdictions around the world if it acted now to embrace the sharing economy.
"Jurisdictions that are building adaptable regulator and tax frameworks are more likely to produce new technologies that will drive economic growth," he said.
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Uber has been controversial in many Canadian cities, refusing to release the terms of its insurance policy on drivers and facing protests by taxi drivers in Toronto and Montreal. It faces bylaw enforcement and legal challenges in Edmonton, Vancouver and Toronto.
Room-sharing is winning over hundreds of converts, but some services have been criticized for not ensuring there is an insurance policy to cover damage to homes.
Then there is the problem of whether Uber drivers or room-sharing contractors pay tax on their new form of income.
"While those gaps exist, while those loopholes exist, there are risks for all users of the sharing economy, both users and contractors of the sharing economy," said Karl Baldauf, vice-president of policy and government relations for the chamber of commerce.
For us, the threat is the lost opportunity,- Karl Baldauf, Ontario Chamber of Commerce
There's no holding back the sharing economy, Baldauf told CBC News, pointing to estimates from PwC Canada that it generates $15 billion in economic activity worldwide in 2015. It estimates that will grow to $335 billion by 2025.
"Global revenues from sharing are growing because a young generation are moving in that direction, taking advantage of mobile technology," Baldauf said.
Sharing services with a strong hold in Ontario include Kickstarter, AutoShare, Zipcar, Uber and Airbnb.
"The question for us is, what share of the sharing economy will Ontario be able to enjoy and what foundation and regulatory framework do we have to put in place to ensure we're well-positioned for Ontario companies to thrive in a sharing economy," Baldauf said.
"For us, the threat is the lost opportunity."
The report put forward several recommendations to get that framework in place.
- Establish a task force with representatives from government and industry to analyze the impact and challenges of the sharing economy.
- Reform regulations to be more flexible and keep only provisions that are necessary and relevant today.
- Engage the insurance industry to create products that cover any gaps in coverage for autos or homes.
- Consider the sharing economy in its review of workplace legislation, currently underway.
- Engage with the Canada Revenue Agency to educate Uber drivers and others earning income from the sharing economy on how to report it.
Canada could be ahead of the world if it moved now to reform business legislation to adapt to the sharing economy, Baldauf said.
He said the report's authors had spoken to competing traditional businesses, including hotel and motel and taxi representatives, before drafting recommendations for the province.
Many of the regulations for these industries are out of date, he said, and a more flexible approach is needed.
"What we're noticing is, as sharing economy companies come into marketplaces, traditional companies are adapting and changing, not only in competition with these new companies but also to new technology," Baldauf said.