Estimate the monetary burden of government regulations using the Standard Cost Model (SCM), calculating Annual Burden and Net Present Value (NPV).
1. Cost Per Occurrence ($C_{Activity}$) = Price ($P$) × Time ($T$)
2. Total Annual Administrative Burden ($C_{Annual}$) = $C_{Activity}$ × Population ($Q$) × Frequency ($F$)
3. Net Present Value ($NPV_{Burden}$) = Sum of discounted costs over $Y$ years:
$$NPV = \sum_{t=1}^{Y} \frac{C_{Annual}}{(1+r)^t}$$
Where $r$ is the social discount rate.
Scenario: A new tax form requires 1,000 businesses ($Q$) to file monthly ($F=12$). It takes 2 hours ($T$) at $50/hr ($P$).
In the landscape of public policy and corporate governance, the cost of following rules is a critical economic metric. The Regulatory Compliance Calculator is a specialized tool designed to quantify the "Administrative Burden" imposed by government regulations. It utilizes the internationally recognized Standard Cost Model (SCM), a methodology used by the OECD, the European Union, and the U.S. Office of Information and Regulatory Affairs (OIRA) to measure the monetary impact of information obligations.
The Regulatory Compliance Calculator does not measure the capital costs of compliance (such as buying new filters for a factory) but rather the administrative costs—the "red tape." This includes the time spent reading instructions, gathering data, filling out forms, and submitting reports. While a single form may seem trivial, when multiplied by thousands of stakeholders ($Q$) and repeated frequently ($F$), the aggregate economic drain can be massive. This calculator provides the essential Net Present Value (NPV) metric, allowing policymakers and business analysts to compare the long-term cost of a regulation against its projected benefits.
Using the Regulatory Compliance Calculator brings transparency to the regulatory process. For businesses, it helps in projecting compliance budgets. For regulators, it acts as a "check and balance" to ensure that the cost of information collection does not outweigh the utility of the data. As noted by the OECD, reducing administrative burdens is a key driver for economic growth and competitiveness. Similarly, the White House OIRA emphasizes the importance of Regulatory Impact Analysis (RIA) in drafting efficient policy. Our Regulatory Compliance Calculator simplifies this complex economic analysis into an accessible format.
Explore all remaining calculators in this Government & Public category.
Explore specialized calculators for your industry and use case.
The SCM is a methodology for determining the administrative burden of regulations. It focuses on the time and money spent by businesses to comply with information obligations (reporting, labeling, registering) rather than the physical costs of compliance.
Future costs are worth less than present costs due to inflation and the opportunity cost of capital. The Discount Rate (standardly 7% for US federal analysis) allows you to calculate the Net Present Value (NPV), making future costs comparable to current dollars.
This is the number of distinct entities that must perform the compliance activity. If a regulation affects all small businesses in a state, the population (Q) would be the total count of those businesses.
In this context, "Administrative Burden" specifically refers to the costs associated with information obligations (paperwork). "Compliance Cost" is a broader term that includes burden plus substantive costs (e.g., buying safety equipment). This calculator focuses on the burden.