Abstract:
This research explores the factors affecting tax compliance among small and
medium enterprises (SMEs) in Burayu Sub city, Shiger City. Utilizing an explanatory
research design, the study identifies the determinants influencing tax compliance
behaviors within this specific context. A sample size of 320 small and medium
enterprises was selected through a systematic sampling technique, ensuring a
representative analysis of the population. Data Were collected from both primary
sources, including surveys and interviews with business owners, and secondary
sources, such as tax records and relevant literature such as factors determining tax
compliance behavior and theories of tax compliance. The findings reveal key factors
impacting tax compliance, including the level of tax knowledge, perceived fairness of
the tax system, enforcement mechanisms, and the role of socio-economic variables.
This study contributes to the understanding of tax compliance issues faced by small
and medium enterprises in Sheger City revenue bureaus and which insights that can
assist policymakers in developing effective tax compliance strategies tailored to the
needs of the small and medium enterprises sector.
