TITLE:
Factors Influencing Tax Compliance among Small and Medium Enterprises (SMEs) in Harare, Zimbabwe: Institutional, Procedural, Informational and Behavioural Drivers
AUTHORS:
Ishmael Chidembo, Abubaker Qutieshat
KEYWORDS:
Tax Compliance, Zimbabwe Revenue Authority, SMEs, Digital Tax Administration, Institutional Trust
JOURNAL NAME:
American Journal of Industrial and Business Management,
Vol.15 No.10,
October
21,
2025
ABSTRACT: Achieving reliable tax compliance among small and medium enterprises (SMEs) is critical for fiscal sustainability in Zimbabwe, yet many SMEs under-comply due to institutional and behavioural factors. Guided by Institutional Theory, Procedural Fairness Theory, and the Theory of Planned Behaviour, this study examines the determinants of tax non-compliance among SMEs in Harare, with particular attention to structural, procedural, informational, and trust-and-fairness factors within the Zimbabwean tax regime. The analysis is set against the backdrop of ongoing digital transformation (Tax and Revenue Management System (TaRMS)) of tax administration by the Zimbabwe Revenue Authority (ZIMRA), recent VAT and income tax reforms, and the tension between formal regulatory expectations and the informal economy. Employing a descriptive cross-sectional survey, primary data was collected from 75 SMEs across retail, services, manufacturing, ICT and other sectors operating in Harare. A structured questionnaire captured perceptions across structural, procedural, informational and trust-and-fairness domains, digital access/usage (TaRMS), and self-reported behaviours. Analysis relied on descriptive statistics and a brief synthesis of open-ended responses to summarise patterns and practical barriers. The study finds that voluntary compliance is constrained by overlapping and frequently changing rules, time-consuming procedures, gaps in VAT and presumptive-tax knowledge, mixed experiences with TaRMS (including system glitches), and uneven trust in enforcement; self-reports show low on-time filing and notable under-reporting. The study concluded that structural, procedural, trust-and-fairness and technological factors jointly depress compliance. The study therefore recommends simplifying and harmonising requirements, stabilising rules and audit processes, delivering targeted, sector-specific taxpayer education and clear communication, improving the reliability and usability of digital platforms, and applying even-handed, risk-based enforcement with clear incentives for compliant firms.