Title: Impact of Tax Policy on Small and Medium Enterprises (SMEs) Growth: A Case Study of SMEs in Wakiso District.
Authors: Akampurira Sarah, Namubiru Gladys
Volume: 9
Issue: 2
Pages: 24-29
Publication Date: 2025/02/28
Abstract:
This study investigated the impact of tax policy on the growth and sustainability of Small and Medium Enterprises (SMEs) in Wakiso District, Uganda. The research aimed to assess the influence of tax rates, tax compliance requirements, administrative procedures, and tax incentives on SME operations. A multiple logistic regression analysis was conducted using data collected from a sample of SMEs in Wakiso District. The findings revealed that tax rates did not have a significant effect on SME growth, and while tax compliance requirements and administrative procedures were perceived as burdensome, they did not significantly hinder SME operations. Moreover, the impact of tax incentives on SME expansion was weak and statistically insignificant. The study highlighted that other factors such as access to finance, markets, and infrastructure were more influential in determining the growth and sustainability of SMEs in the district. Based on these findings, the study recommends simplifying tax compliance processes, providing financial support, enhancing market access, promoting innovation, and fostering a more SME-friendly regulatory environment to stimulate SME growth and sustainability. The research contributes to understanding the complexities of tax policy's role in SME development in Uganda and provides insights for policymakers to create more effective tax policies for SMEs.