Supposedly, the so-called “Corporate Transparency Act” is designed to help fight crime, but it does that in name only. In reality, it throws up a costly and intrusive new obstacle for small business owners.

Alaska is a good place to run a small business because of a reasonably low amount of red tape compared with other states. Keeping that red tape to a minimum is crucial. The small business owners who make up my organization, the National Federation of Independent Business, see federal paperwork as a major challenge, and rank unreasonable government regulations second only to high taxes as their biggest problem.

 Unfortunately, the “Corporate Transparency Act” promises more red tape. It would require small businesses with 20 or fewer employees to regularly file a list of their owners with the federal government, including highly detailed personal information.

Amazingly, larger businesses and big corporations are exempt. This is the opposite of most laws. Big corporations have the resources to deal with burdensome regulations. Mom-n-pop shops usually don’t.

It doesn’t make sense to single out small businesses in Alaska like this. Our state’s small businesses create 53 percent of our jobs, and the firms with 20 employees or less that this bill specifically targets are most responsible for that growth.

These small businesses are already dealing with enough paperwork. As anybody who files their taxes knows, dealing with government forms sucks up a lot of time, energy and even money. Small business owners and entrepreneurs have it even worse, potentially facing years in prison as well as $10,000 in fines for failing to comply with the Corporate Transparency Act. And that’s on top of the countless other regulations and penalties.

This new burden will be tough to handle. Say the owner of a local crafts store decides to gift one of her children with an ownership stake, perhaps as a reward for working in the family business. Failing to report that to the feds, or making a single mistake on the submission, could land her in prison. Businesses change hands or welcome new partners into its ownership for many reasons, and the Corporate Transparency Act would require them to fill out forms every time that happened.

The bill also exposes personal information to potential privacy violations. That’s because the information collected would be shared freely among local, state and federal agencies — even foreign governments. Government officials with an agenda could misuse it, or it could fall into the hands of identity thieves. Hardly a week goes by without another story of a federal database getting hacked.

Alaska’s small business community isn’t known as a hotbed of organized crime, and the government already has the tools it needs to investigate any business it suspects. Congress never asked small business owners how they feel about this legislation, but needless to say they’re not happy. Over 80 percent of the small businesses oppose this kind of over-regulation.

This is a classic case of legislation that looks good until you peer a little deeper. Congress wants to seem like they’re tough on crime. With the Corporate Transparency Act, they’re just being tough on job creators. Alaska’s small businesses deserve better, which is why our lawmakers should oppose this bill.

Thor Stacey is state director of the National Federation of Independent Business, Alaska’s leading small-business association. He’s a lifelong Alaskan and a registered hunting guide.