The Determinants of Tax Evasion Behaviour by Small to Medium Enterprises (SMEs) In Harare Metropolitan Province, Zimbabwe

Abstract – Time immemorial, tax evasion has presented itself as a thorn in the flesh for almost all tax administrators world-wide. Though many researchers have devoted precious time in studying the determinants of tax evasion, findings remain inconclusive. This study examines the determinants of tax evasion behaviour by Small to Medium Enterprises (SMEs) in Harare Metropolitan Province in Zimbabwe. A Linear Probability Model (LPM) was employed since the dependent variable was dichotomous in nature. Explanatory variables considered in the study were; tax burden, marital status, tax education, income and perceived fairness of the tax system. Findings unearthed statistically significant positive relationship between tax compliance and tax education, income and perceived fairness of a tax system.

Keywords: Tax evasion, Linear Probability Model, Small to Medium Enterprises

[Cite as: Chinorwadza, T., and Mutonhori, T. (2020). The Determinants of Tax Evasion Behaviour by Small to Medium Enterprises (SMEs) In Harare Metropolitan Province, Zimbabwe. Diverse Journal of Multidisciplinary Research, Vol. 2, Issue 4, Pages 1-8.]