Taxation and Financial Performance of Small and Medium Enterprise (SME) In Port Harcourt

Gitam The study examined the relationship between taxation and financial performance of quoted SMEs in Nigeria from 2013 to 2017. Company income tax and education tax were taxation proxies while return on investment, return on assets and current ratio were the proxies of financial performance. The researchers adopted expost-facto research design for the study. The study used secondary data obtained from the audited annual reports and accounts of the ten listed SMEs’ website and whose stocks are traded on the alternative security market (ASeM) in the Nigeria stock exchange. The research data was analyzed using basic descriptive, Pearson product moment correlation and multiple regression in a panel data setting with the aid of E-View version 9. The results revealed that company income tax and education tax have no significant relationship with return on investment return on assets and current ratio quoted small and medium enterprises in Nigeria in the period of this study. We thus concluded that taxation has no significant relationship with financial performance of SMEs in Nigeria in the period of this study. It is recommended that government should review downward the current corporate tax rate of 30% on SMEs to enable them perform optimally in this highly business competitive environment in Nigeria. We equally endorsed that Nigerian tax authority should carry out their duties more efficiently with the most care and integrity to combat multiple taxes for better performance.