Global Journal of Economic and Finance Research

The article examines how the current tax system in Kinshasa affects the economic performance of small and medium-sized enterprises (SMEs), which are central to employment and value creation but operate in a complex and often unpredictable fiscal environment. Drawing on neoclassical tax theory and tax burden theory, the study conceptualizes taxation both as a potential driver of formalization and growth and as a constraint that erodes profitability when the tax burden and compliance costs are excessive. Using a quantitative survey of 388 SME managers across eight communes in Kinshasa and multinomial logistic regression, the research empirically tests the effect of tax variables on the likelihood of achieving positive, neutral, or negative performance. The findings show that high tax pressure, administrative complexity, and a perceived lack of fairness significantly reduce investment capacity and the probability of positive performance, while only a minority of manager’s view taxation as beneficial. The study concludes that SME performance is jointly determined by economic, organizational, and institutional factors, and that tax reform should prioritize simplification, predictability, and better alignment with SMEs’ payment capacity to enhance their contribution to inclusive and sustainable growth.​

taxation, small and medium-sized enterprises, economic performance, tax burden, Kinshasa, fiscal reform

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