In my area, it takes no fewer than three different licenses just to set up a consultancy that doesn't even sell products (pure service oriented business) -- and that doesn't address any of the issues aside from licensure (tax ID, ensuring your business name is not a trademark infringement, et cetera). The worst thing about it, though, is not the complexity of it. The worst thing about it is that, because one has to check everything at local, state, and federal levels, and because each of these levels is often very poorly organized where the "end user" is concerned, it took me an afternoon just to find out about all that stuff. In fact, some of it I stumbled across by accident while looking for something else, and was surprised to find it. I'm pretty much positive that I missed some things before I gave up.
It requires a lawyer to be even reasonably sure (as opposed to completely sure) you aren't doing something illegal. If I have to choose between paying for a lawyer I can ill afford and wondering for the first three years of starting the business whether I'm going to end up in court for doing it wrong, the process of setting up a business is not easy enough.
edit: There is a difference between "setting up" a business on paper (so you can claim to have one) and being able to start actually conducting business without running the risk of pissing off government.
I agree that there is a difference. On the other hand, once you have the business legally established (the easy part), you can conduct business as that entity. You might piss off the government and the liable for fees/penalties, but you're not going to invalidate the actions of the business by doing that.
Perhaps I'm just being naïve, but I figure if the rules are difficult for me to find it's also fairly unlikely that I'll get caught for not following them. Or, I suppose, I feel like by the time it becomes a serious risk I'll have grown to the point where lawyers become a necessity anyway.
One can conduct business in violation of the law anywhere. When it's done intelligently, we call the result "black marketeering". When it's done stupidly, we call the result "jail time".
It requires a lawyer to be even reasonably sure (as opposed to completely sure) you aren't doing something illegal. If I have to choose between paying for a lawyer I can ill afford and wondering for the first three years of starting the business whether I'm going to end up in court for doing it wrong, the process of setting up a business is not easy enough.
edit: There is a difference between "setting up" a business on paper (so you can claim to have one) and being able to start actually conducting business without running the risk of pissing off government.