The impact of multiple taxation on the survival and Sustainable Growth of Small And Medium Tourism Enterprises (SMTES) in Afghanistan

Abstract

This study investigates The Impact of Multiple Taxation on The Survival and Sustainable Growth of Small and Medium Tourism Enterprises (SMTEs) In Afghanistan. These enterprises are vital to both developed and developing economies due to their contributions to production, innovation, employment, and competition. They promote entrepreneurial skills and economic dynamism. However, their operations are increasingly undermined by the burden of multiple and overlapping taxes. The research uses a mixed-methods approach, combining qualitative and quantitative data. Qualitative data, gathered through interviews and interpreted from a phenomenological perspective, captures the lived experiences and viewpoints of SMTE owners. Quantitative data, collected through structured questionnaires, is analysed using tables, charts, and SPSS software for clearer interpretation. The findings reveal that multiple taxation in Afghanistan is driven by several factors, including the government’s efforts to boost tax revenues, conflicts between different tax authorities, poor tax policy design, attempts to recover public service costs, protection of local industries, and environmental recovery initiatives. As a result, SMTEs face numerous taxes, such as those on restaurants, hotels, tour operators, value-added tax (VAT), petroleum, stamp duties, local excise duties, and infrastructure levies. These taxes have significant negative consequences for SMTEs. They increase operational costs, restrict business growth, cause inflationary pressures, lead to inefficient use of time, discourage investment, and promote tax evasion. Many SMTEs struggle to stay in business, especially during their early years, due to limited cash flow and financial strain caused by high tax obligations. The study concludes that to ensure the sustainability of SMTEs, the Afghan government should minimize frequent changes in tax legislation and involve stakeholders in the policymaking process. Any legal or policy adjustments should be carefully planned and necessary, aiming to create a more stable and supportive environment for small and medium-sized tourism enterprises.