Relationship between Tax Policy, Growth of SMEs and the Nigerian Economy

Ojochogwu Winnie Atawodi, Stephen Aanu Ojeka

Abstract


This research work tries to establish if any relationship exists between the growth of SMEs and the tax policy
environment within which they operate. Using business sustenance and expansion as indices of growth, it
analyzes responses obtained questionnaires distributed to SMEs in Zaria, North Central Nigeria. Sampling for
the survey was done using the non-probability sampling method specifically by judgmental sampling. The
hypothesis was tested using Spearman’s Rank Correlation. Although there is a general perception that that tax is
an important source of fund for development of the economy and provision of social services, the study revealed
a significant negative relationship between taxes and the business’ ability to sustain itself and to expand. In order
to obtain a vibrant and flourishing SME sector, the tax policy needs to be appropriate such that it will not be an
encumbrance to the growth of small and medium enterprises.


Full Text: PDF DOI: 10.5539/ijbm.v7n13p125

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International Journal of Business and Management   ISSN 1833-3850 (Print)   ISSN 1833-8119 (Online)

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