Research Article

Effect of Multiple Taxation on the Financial Performance of Small and Medium Enterprises (SMEs) in Ekiti State, Nigeria

Authors

  • Yinka M. ADEWARA Department of Accounting, College of Social and Management Sciences, Afe Babalola University, Ado-Ekiti, Ekiti State, Nigeria
  • Muyiwa Emmanuel DAGUNDURO Department of Accounting, College of Social and Management Sciences, Afe Babalola University, Ado-Ekiti, Ekiti State, Nigeria https://orcid.org/0000-0002-1177-7101
  • Gbenga Ayodele FALANA Department of Accounting, College of Social and Management Sciences, Afe Babalola University, Ado-Ekiti, Ekiti State, Nigeria https://orcid.org/0000-0002-1177-7101
  • Temitayo O. BUSAYO Department of Accounting, College of Social and Management Sciences, Afe Babalola University, Ado-Ekiti, Ekiti State, Nigeria https://orcid.org/0000-0003-0507-4394

Abstract

The performance and growth of business enterprises, especially small and medium enterprises (SMEs), have been hindered by a multiplicity of taxes causing the untimely liquidation of most businesses. In this regard, this study examined the effect of multiple taxations on the financial performance of SMEs in Ekiti State, Nigeria. The study used a survey research method and analyzed it with correlation coupled with multiple regression analysis. The population comprises all registered and functional SMEs located in Ado Ekiti, Nigeria, and have been in existence for over 5 years with valid proof of tax payment. The results found that multiple tax burdens and multiple tax administrations exhibited a significant negative relationship with the financial performance of SMEs in Ekiti State, Nigeria, while the ability to pay tax revealed a significant positive relationship. From the aforementioned results, it was concluded that multiple taxes served as a worm that deeply reduced the investment potential of SMEs and invariably affected the chunk of revenue generated by the sector in the state. It was therefore suggested that the Joint Tax Board in the state and other institutions responsible for multiple tax management should awaken to their functions and harmonize all government revenue to prevent the occurrence of multiple taxes from causing a burden and hindering the survival of SMEs in the state.

Article information

Journal

Journal of Economics, Finance and Accounting Studies

Volume (Issue)

5 (3)

Pages

121-129

Published

2023-05-30

How to Cite

ADEWARA , Y., DAGUNDURO, M., FALANA, G., & BUSAYO, T. O. (2023). Effect of Multiple Taxation on the Financial Performance of Small and Medium Enterprises (SMEs) in Ekiti State, Nigeria. Journal of Economics, Finance and Accounting Studies , 5(3), 121-129. https://doi.org/10.32996/jefas.2023.5.3.10

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Keywords:

Multiple Tax Burden, Multiple Tax Administration, Ability to Pay Tax, Financial Performance of Small and Medium Enterprises