...CHAPTER ONE INTRODUCTION 1.1 Background to the Study Since the 1960s to date, small and medium sized enterprises (SMEs) have been given due recognitions especially in the developed nations for playing very important roles towards fostering accelerated economic growth, development and stability within several economies (Yitzhaki, 2006). They make-up the largest proportion of businesses all over the world and play tremendous roles in employment generation, provision of goods and services, creating a better standard of living, as well as immensely contributing to the gross domestic products (GDPs) of many countries (OECD, 2000).Over the last few decades, the contributions of the SMEs sector, the development of the largest economies in the world have beamed the searchlight on the uniqueness of the SMEs; and this have succeeded in overruling previously held views that SMEs were only ―miniature versions‖ of larger companies (Al-Shaikh 1998; Gaskill et al. 1993). And although Small and Medium Enterprises have been at the center of the policy debate for quite some time in both developed and developing countries, little analytical work has been undertaken in this area.The dearth information that exists among researchers on Small and Medium Enterprises however provides a sense of how important this sector is for sustainable development in emerging economies (Medina, 2001). For instance, recent studies conducted by United Nations Industrial Development Organization (UNIDO) concur that SMEs...
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...TAX COMPETENCIES, COMPLIANCE COSTS AND INCOME TAX COMPLIANCE AMONG SMEs IN UGANDA BY ANNET NAKIWALA 2007/HD10/11264U A DISSERTATION SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENT S FOR THE AWARD OF THE DEGREE OF MASTER OF SCIENCE IN ACCOUNTING AND FINANCE OF MAKERERE UNIVERSITY September, 2010 TAXCOMPETENCIES, COMPLIANCE COSTS & INCOME TAX COMPLIANCE DECLARATION I, Annet Nakiwala, declare that this dissertation is my own work and that it has never been presented for a degree award at any other university. Signature: ………………………………………… Date: ……………………………………………… ii TAXCOMPETENCIES, COMPLIANCE COSTS & INCOME TAX COMPLIANCE APPROVAL This is to certify that this dissertation has been submitted in partial fulfillment of the requirement for the award of a Masters of Science degree in Accounting and Finance of Makerere University with my approval as University Supervisor. Joseph Ntayi (PhD) Supervisor Signature: ………………… Date: ……………………… Arthur Sserwanga Supervisor Signature: ………………… Date: …………………….. iii TAXCOMPETENCIES, COMPLIANCE COSTS & INCOME TAX COMPLIANCE DEDICATION I dedicate this entire effort to my late Mother Gorreth Nabagereka. We miss you dearly. iv TAXCOMPETENCIES, COMPLIANCE COSTS & INCOME TAX COMPLIANCE ACKNOWLEDGEMENTS Completion of this research has been a result of both direct and indirect support of many people to whom I owe acknowledgement. I owe profound gratitude to my supervisors Dr. Joseph Ntayi and...
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...these many breweries sustainable in the long run? The research has shown that craft breweries are growing in record numbers. The market is ripe for it. The consumer base is also expanded beyond the college student to the beer drinking connoisseur. In recent years, craft brewers have sounded an alarm over the clout of Anheuser-Busch Inbev and MillerCoors, who today control 90 percent of the beer market. Craft brewers hold just 6 percent, but the market share is growing (Hieronymus, 2010). "Their preferred business model is an oligopoly," says Koch of the company that was once interwoven with his family. "I don't see them as trying to deliberately set out to destroy us. But we are very potentially the collateral damage." Oligopolies are small groups of firms that control a particular market. DogFish Head Brewery fits this description perfectly. Though many microbreweries are operating successfully, they are still only 6 percent of the market. They do however have the power in this specialty arena (Hieronymus, 2010). Mergers are a means of staying viable in business for some...
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...flexibility in operations. The sole proprietorship business is undertaken on a small scale. If any change is required in the operations, it is easy and quick to bring the changes. Another advantage in this type is the ease of promptness in decision-making, autonomy. When the decision is to be taken by one person, it is guaranteed to be quick. Thus, the entrepreneur, as a sole proprietor, can arrive at quick decisions concerning the business because he does not have to ask anybody else. There is only one person that makes decisions, therefore, there is no other to criticize, or challenge a decision made. A third advantage is the simplicity of the business. Because of this, it is the most common type of business entity. The only difficulty of this business type is obtaining licenses and permits in the state of operation. If the business will be run under a different name than that of the individual who owns it, a separate special certificate must be filed. Sole Gain is seen as a highly ranked advantage because all revenue goes back to the single investor, the entrepreneur. There are no shareholders to declare dividends. The primary advantage for a sole proprietorship is the single taxation. The owner files as an individual, filing a Form 1040 and a Schedule C (Profit or Loss from Business or Profession). All profits and/or losses are reported by the individual. This is known as pass-through taxation. Along with advantages, sole proprietorship has its disadvantages. One of these...
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...STRUCTURE, ADMINISTRATION OF VAT IN BANGLADESH WITH SPECIAL REFERENCE TO EVASION CONTROL AND MEASUREMENT OF VAT POTENTIAL DR. RAFIQUL ISLAM First Secretary VAT : Policy National Board of Revenue Government of Bangladesh. (The author acknowledges special thanks to Mr. Saiful Islam Khan, Member (VAT), NBR for his constant guidance in preparing this article. Dr. Mahesh C. Purohit, Professor of National Institute of Public Finance and Policy, New Delhi, India was kind enough to comment on the initial draft which helped to improve it. However, the views expressed in the article are of the author and do not necessarily reflect any opinion of the organisation he serves) Taxing Our Patience Communication is all about people being able to understand each other. Except when it comes to Government forms and directives. That's when middle brained civil servants are in a class of their own. The following is in latest example which arrived in employer's offices courtesy the Inland Revenue : "Errors on form P38A (1992). Form P38A (1992) was enclosed with the form P35 (Employer's annual return) sent to you in late January / early February. We apologise for the fact that Form P38A contained the following two errors. 1. Question No. 1 of the check list on Form P35 says you should complete form P38A if you answer 'No' to this question. However, Form P38A itself asks you to complete it if you answered 'Yes' to Question 1 on the form P35. 2. On form P38A Question 3 asks 'Was the worker paid less...
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...STRUCTURE, ADMINISTRATION OF VAT IN BANGLADESH WITH SPECIAL REFERENCE TO EVASION CONTROL AND MEASUREMENT OF VAT POTENTIAL DR. RAFIQUL ISLAM First Secretary VAT : Policy National Board of Revenue Government of Bangladesh. (The author acknowledges special thanks to Mr. Saiful Islam Khan, Member (VAT), NBR for his constant guidance in preparing this article. Dr. Mahesh C. Purohit, Professor of National Institute of Public Finance and Policy, New Delhi, India was kind enough to comment on the initial draft which helped to improve it. However, the views expressed in the article are of the author and do not necessarily reflect any opinion of the organisation he serves) Page # 2 Taxing Our Patience Communication is all about people being able to understand each other. Except when it comes to Government forms and directives. That's when middle brained civil servants are in a class of their own. The following is in latest example which arrived in employer's offices courtesy the Inland Revenue : "Errors on form P38A (1992). Form P38A (1992) was enclosed with the form P35 (Employer's annual return) sent to you in late January / early February. We apologise for the fact that Form P38A contained the following two errors. 1. Question No. 1 of the check list on Form P35 says you should complete form P38A if you answer 'No' to this question. However, Form P38A itself asks you to complete it if you answered 'Yes' to Question 1 on the form P35. 2. On form P38A Question 3...
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...of the Study In the U.S., the Small Business Administration includes some manufacturing firms with employment up to 1500 in their definition of a small business. The World Bank (2010a), on the other hand, defines micro firms as generally having less than 10 employees, small firms as having 10-49 employees (though there are exceptions) and medium-size firms at 50-249 employees (again with exceptions).Small firms tend to operate on the fringe of the formal economy, with only loose connections to the formal tax and regulatory apparatus of the state. Their activities are often labor intensive, meaning fewer interactions with market traders of tangible goods who may be in the tax net; they rely disproportionately on cash transactions; there are few opportunities for third-party verification; and they have poor bookkeeping practices. Tax policy is often uniquely designed for small enterprises, The smallest firms frequently rely heavily on the labor of the entrepreneur and her family. Revenue mobilization in developing countries is challenging and especially so when it comes to generating taxes from small enterprises. This represents a conundrum for policymakers and tax administrators. On the one hand there is a compelling need for revenues to meet spending and social objectives including some semblance of fairness in taxation. At the same time it is widely recognized that in many countries the cost of revenue mobilization from (at least some) small firms—including both administration...
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...POE -help the private sector formulate an industrialization and it plan, so that there would be more ‘made in the Philippines’ products. -strengthen the “study now, pay later” program. -give farmers their own land, boost irrigation and push for mechanization, and look for a program to make fishing, farming and livestock propagation profitable for the farmers and the youth. - look for ways to lower power costs and resolve the frequent brownouts in Mindanao. And find ways for the development of renewable energy. - People should be able to rely on expanded benefits through Philhealth. - bring about reforms to achieve inclusive growth, global competitiveness, and transparent government. POE -help the private sector formulate an industrialization and it plan, so that there would be more ‘made in the Philippines’ products. -strengthen the “study now, pay later” program. -give farmers their own land, boost irrigation and push for mechanization, and look for a program to make fishing, farming and livestock propagation profitable for the farmers and the youth. - look for ways to lower power costs and resolve the frequent brownouts in Mindanao. And find ways for the development of renewable energy. - People should be able to rely on expanded benefits through Philhealth. - bring about reforms to achieve inclusive growth, global competitiveness, and transparent government. SIMILARITIES * To provide adequate Education * Help the poor and the...
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...difficulties. We are also grateful to our group members’ most valuable cooperation, inspiration and suggestions. EXECUTIVE SUMMARY This dissertation report highlights on our practical experience in different types and categories ‘Tax System’ especially Tax System Of Bangladesh. During our short working period, we tried to gather information from News Paper, web sites. But the NBR does not provide information in the web site directly and even it does not publish tax structure implement in Bangladesh. So, we take much information about tax in our personal concept and view of Tax System of Bangladesh. To complete this report, we have gained practical knowledge about various type of Tax System. For example, Tax System Of Bangladesh, canon of taxation and implementation the canon of Bangladesh in Tax System Of Bangladesh. In this way, we are getting knowledge not only the tax system but also the implementation of canon on tax system of Bangladesh. As, tax is an important part of our country development. so, day by day, people are getting more conscious and informed about tax. Object of this study We can gain knowledge about the tax system of Bangladesh by studying this topic. As following aspects of tax we can learn from this study: 1. To get the idea about the collection of revenue, as context of Bangladesh. 2. How distribute the income of people in Bangladesh is allocated....
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...inadequate and has lagged behind its overall stage of development according to international norms. Table of Contents 1. INTRODUCTION 2 2. THE IMPACT OF SERVICE SECTOR IN CHINA 2 3. DIFFERENCES AND GAPS 4 4. OBSTACLES AND RESTRICTIONS 6 5. RECOMMANDATIONS AND CONCLUSION 10 REFERENCES 12 1. INTRODUCTION The result of the market-oriented reforms in China along with its opening up to the outside world were rapid industrialization and integration in international trade. The service sector has perceived a fast, continued development and has made huge contributions to the overall economy in terms of its share of gross domestic product (GDP) and employment. The increasing of the service sector has caught up with the manufacturing sector, which indicates that China is moving into a new stage of development with both sectors driving economic growth. As China is a developing country with a middle-income status, the development of the service sector has been inadequate and has lagged behind its overall stage of development according to international norms. The gap in the development of the service sector between China and the developed countries and also some...
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...Income Tax Law Income Tax Law and the National Budget 2010-2011 Md. Abdur Rashid, FCMA B.Com. (Hons.), M.Com., DAIBB, LLB, FCMA Income Tax Law explain changes in tax struc-ure of an economy over time under t the impact of economic development and of political and social factors. Tax structure is affected by economic development in three ways: (a) tax base undergoes a change as the develop- ental process m proceeds; (b) change in the tax base brings about changes in the revenue system: and (c) economic development leads to changes in the objectives of tax policy. Bangladesh Government collects taxes on account of custom duty, sales tax, value added taxes, excise duty, cess, fees, fines, penalties, income tax, advalorem duty, etc. It appears that to fulfill the objectives of tax policy the Government every year brings some changes in various tax laws to collect more taxes on the basis of above tax structure. be established for those items to repair or servicing and thus to reduce the unemployment problems in the country. National Budget Every year before preparing National Budget the National Board of Revenue holds series of meetings with various trade bodies, trade associations, groups of people, various academic and professional Institutions. It seems that this year the discussions have been held on various scopes and opportunities of collecting more taxes. The discussions, of course, have been held in various dimensional scopes. In such a meeting organized by Management...
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...Legal Issues for Business Organizations Sole Proprietorship The sole proprietorship is the most common form of business and has been around for many years. It is the simplest form of business because it is owned and operated by an individual. Some advantages to choosing a sole proprietorship would be minimal state and federal regulations, which make it easy to control and manage. Another is the cost to start a Sole Proprietorship is minimal. It is a good form of business for someone who is starting out small. In many cases this type of business can be operated out of the owner’s home. All business decisions are made by the owner, therefore he or she is entirely responsible for the operations, financial and legal aspects of the business. Some disadvantage to a sole proprietorship would be. The owner has unlimited liability and his personal wealth and assets are at risk to claims against the business. Another would be that raising capital is difficult for a sole proprietorship and is usually limited to the owner’s personal funds or credit available based on his personal credit history. Another key point to a sole proprietorship is that the business is not required to file or pay taxes. The sole proprietorship is a tax reporting entity, not a tax paying entity so the business taxes are filed at the personal rate of the owner on his personal income taxes. Business Services Sole proprietorship (May 20, 2008). Retrieved on (March 9, 2010) from Iowa Secretary of State. http://www...
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...Published: August 30, 2013 doi:10.5539/ass.v9n11p135 Abstract URL: http://dx.doi.org/10.5539/ass.v9n11p135 Various parties including academics, professionals and the society (the potential GST payers) are arguing about the introduction of GST in Malaysia. Goods and Services Tax (GST) or Value Added Tax (VAT) is a consumption tax imposed on the sale of goods and services. The Malaysian government introduce this potential tax mechanism, in order to increase the existing tax bracket and replacing the long-implemented service and sales taxes. With the introduction of GST, the Malaysian government felt it would provide them with the prospect to reduce the rates of individual and corporate income tax. However, do all companies particularly small and medium enterprises (Companies) ready to adopt the systems efficiently? If they could adopt the system, how much their compliance costs involved such as developing new software, human resource training and accounting systems? The objective of this paper is to obtain companies’ compliance costs and its elements and to provide suggestions to the tax authority what are the essential of companies to minimize their compliance costs. The data was collected through questionnaire from various enterprises throughout...
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...to Php314 billion. No monetary equivalent can also be juxtaposed to the hours of painful treatment just to manage the diseases, nor the time and energy a family member spends to care for the loved one. More so, these numbers do not even reflect the pain of losing someone you love. But for decision-makers, these exact figures and immeasurable realities are not compelling enough to pass the necessary measures to reduce tobacco use. Instead, the most marginalized and the poorest sectors are pitted against each other to rationalize inaction - tobacco victims versus farmers, workers against children and youth. Life versus livelihood. The battle of the sectors has been the easiest tactic to muddle the discourse on amendments to excise taxation. What we fail to remember is that all of these sectors - farmers, urban poor, youth, children, and workers are the tobacco victims. They are the ones selling their produce at a lower cost because of the monopoly, the ones earning below minimum wage or, worse, hired contractually, and they are also the primary consumers-replacement smokers-turned-patients a few years after being addicted to smoking. They are the same people continuously getting trapped in the vicious poverty cycle of having less education, lower income, poorer health, and...
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... * Income Taxes - Tax planning can be difficult to take advantage of lower income tax rates, due to all the income generated by business is treated as personal income. * Longevity/Continuity - As long as the owner is alive the business can continue. * Control – The owner has full autonomy of the business. * Profit Retention - All the income generated from the business belongs to the owner. * Location – The owner has full autonomy of the location. * Convenience/Burden - The convenience of a sole proprietorship is its easy to start a business, you have full autonomy of the business and you have totally ownership of the finances. The burden of a sole proprietorship is the owner usually suffers the highest rate of taxation and unlimited liability for business debt is a major burden. General Partnership: * Liability - Every partner in the partnership is jointly and severally liable for the partnership’s debts. * Income Taxes - The partnership is considered a disregarded entity for tax purposes, so income “flows through” the business to the partners, who then pay ordinary income tax on the business income. * Longevity/Continuity - As long as both partners are getting along the business could last a long time. * Control – The partners share control of the business, they make the decision together. * Profit Retention – The partners split the profit. * Location – Wherever the partners agreed to have the location of the business....
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