Tax Compliance and Business Formalization among Commercial SMEs in La Maná Canton, Ecuador: Determinant Factors
Keywords:
Tax compliance, SMEs, business formalizationAbstract
Tax compliance among small and medium enterprises (SMEs) constitutes a structural challenge in emerging economies. This study identified and described the determinants of tax compliance and their relationship with business formalization in 15 commercial-sector SMEs in La Maná canton, Ecuador, during the first quarter of 2024. Using a quantitative, non-experimental, cross-sectional design, a structured 26-item Likert-scale questionnaire was applied, organized into six dimensions: tax knowledge, equity and institutional trust, compliance costs, tax assistance and digitalization, tax compliance, and business formalization. Internal reliability was excellent across all dimensions (Cronbach's α between 0.914 and 0.940). Results show that all dimensions are at a medium level (M between 2.69 and 3.12) with high intragroup variability. Spearman correlation analysis yielded no statistically significant relationships (p > 0.05), attributed to the reduced sample size. The study provides exploratory empirical evidence on tax dynamics in a specific territorial context and highlights the need to strengthen fiscal education and digital assistance programs in La Maná canton.
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