GOVERNMENT POLICIES AND PERFORMANCE OF SMALL AND MEDIUM ENTERPRISES IN NIGERIA

Abstract

Small and medium-sized enterprises (SMEs) are crucial in providing jobs, promoting economic growth, and encouraging innovation. SMEs in Nigeria face multiple and high taxes, inconsistent tax policies, a complex regulatory environment, and inadequate infrastructure. The study investigates government policies on the performance of small and medium enterprises in Nigeria by focusing on SMEs in the Southwest region with specific goals to evaluate how tax policies affect SMEs' performance and ascertain how licencing affects such businesses' performance. This research used a survey research design. The study population consisted of one hundred and forty-nine thousand three hundred and seventeen registered SMEs in operation with the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN). The study used a sample size of 384 respondents selected based on the Raosoft formula. Hypothesis was tested through multiple linear regression. The outcome showed that there is a considerably positive influence of government policy on performance of SMEs. The findings shows that tax regulation and licencing is important in enhancing the performance of SMEs in Southwest Nigeria. The research therefore recommended that the government should find it necessary to adopt a better system of fiscal management that would aid in reducing inefficiencies in tax compliance.