The Impact of Multiple Taxation on the Efficiency of Selected SMEs in Enugu State, Nigeria

Abstract

Small and Medium-sized Enterprises (SMEs) are entities that contribute to the overall growth and economic development of a country. However, multiple taxation has been found to hinder the production activities as well as the efficiency of SMEs. This study investigated the impact of multiple taxation on the efficiency of selected SMEs in Enugu State, Nigeria. The study was based on three objectives and two hypotheses. The study is a survey and made use of questionnaire schedule. The population of the study was 17,498 registered SMEs from which 204 were selected as sample using Taro Yamane statistical formula. Statistical Package for Social Sciences (SPSS) was used to process the data collected for the study. Data analysis was done using descriptive statistics (frequency tables and Chi-square inferential statistics were used to test the study hypotheses). Result from the study showed that multiple taxation makes it difficult for SMEs to carry out their production activities; it also reduces SMEs production and service-rendering capacity. The study also found that multiple taxation makes management of SMEs more difficult. Based on the findings of the study, it was recommended that government adopting a single tax system that levy SMEs based on how they earn and using the taxes for the benefit of SMEs will reduce the problems of multiple taxation that affect the production and management efficiency of SMEs in Enugu State.