EFFECT OF MULTIPLE TAX ON THE FINANCIAL PERFORMANCE OF SMALL AND MEDIUM ENTERPRISES (SMES) IN BIDA LOCAL GOVERNMENT, NIGER STATE

The growth and overall performance of business enterprises particularly Small and Medium Enterprises (SMEs) have faced considerable setbacks due to the imposition of multiple taxes. This overwhelming tax burden has been a major contributing factor to the premature collapse of many SMEs. In light of this challenge, the present study explored the impact of multiple taxation on the financial performance of SMEs operating in Bida Local Government, Niger State To carry out this investigation, the study adopted a survey research design, gathering data through structured questionnaires administered to SME operators. The data collected was analyzed using both correlation and multiple regression techniques to examine the strength and direction of the relationships among the variables. The target population consisted of all registered and actively operating SMEs within Bida Metropolis. The inclusion criteria required that these businesses must have been in continuous operation for at least five years. Findings from the analysis revealed that the burden of multiple taxation and the inefficiencies in tax administration had a statistically significant negative impact on the financial performance of SMEs in Bida. Conversely, the capacity or ability of SMEs to pay taxes demonstrated a significant positive influence on their financial outcomes. These findings suggest that the existence of overlapping and excessive taxes acts like a parasitic force, draining the financial vitality of SMEs and diminishing their capacity for growth and investment. This in turn, undermines the revenue-generating potential of the SME sector, which is critical to the economic development. Based on the study’s findings, it was recommended that the Joint Tax Board in Bida Niger State, along with other regulatory and revenue-generating bodies, should take proactive steps to streamline and harmonize the tax structure. Such measures would help eliminate redundant taxes and ease the tax burden on SMEs, thereby fostering a more enabling environment for business sustainability and growth.