Depends on if B leads (via lower wages) to more of B to compete.
For example the government may say that to clean their facility, cleaning companies need to be able to do a, b, c and after that it all comes down to the price. Almost all of them can do a,b,c so they compete on price, on cleaning company is not paying taxes though so can offer lower prices and wins all deals, forcing all other companies to stop paying taxes to survive, and makes the whole trade in that area morally bankrupt.
If type b companies are not allowed to exist, the market will then be able to support more type a companies and may ultimately have less type c individuals. It may result in a net decrease of social services used.
For example the government may say that to clean their facility, cleaning companies need to be able to do a, b, c and after that it all comes down to the price. Almost all of them can do a,b,c so they compete on price, on cleaning company is not paying taxes though so can offer lower prices and wins all deals, forcing all other companies to stop paying taxes to survive, and makes the whole trade in that area morally bankrupt.
See also: construction business & tipping.