The Cost of Tax Compliance for Small, Medium and Micro Enterprises in South Africa

High tax compliance costs are associated with larger informal sectors, more corruption and less investment. As no study to date provides a comprehensive baseline for small, medium and micro enterprises’ (SMMEs) tax compliance costs in South Africa, determining whether these costs have increased or decreased over time will be impossible and the impact of reforms introduced by government will not be measurable. This study thus sought to suggest a baseline by employing a quantitative research design using data collected from an online survey conducted among SMMEs registered with the South African Revenue Service. This assessment is vital because these costs can affect SMMEs and the economy negatively if they are high and the underlying factors giving rise to this are not addressed and/or if appropriate reforms are not introduced to mitigate these factors.