Factors Affecting Tax Compliance Of Small And Medium Enterprises Tax Payers In Sheger City (The Of Case Of Burayu Sub city)

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.