Purpose This study aims to investigate the extent to which the theory of reasoned action (TRA) can be used to explain tax compliance among small business enterprises (SBEs) in Uganda and extends the application and relevance of the theory to a new area of tax compliance. It contributes the TRA, as a predictor of tax compliance in a developing country context. Design/methodology/approach A cross-sectional survey targeting different categories of SBEs was carried out using interviewer-administered questionnaires. A sample of 384 SBEs was used in the study. Findings The TRA contributes critical insights on the tax compliance behaviour of small businesses in developing economies. It influences tax compliance behaviour. The study illustrates evidence about the negative attitudes SBEs have on intentions to comply with tax regulations and the extent to which these attitudes influence their compliance behaviour. Subjective norms positively influence tax compliance intentions in a positive manner. Overall, the appearance of these intentions shows a negative effect on tax compliance behaviour. These findings also imply that Uganda Revenue Authority needs to understand the social psychology of taxpayers and tailor these in their policies and efforts to increase compliance. Research limitations/implications The TRA has been used to explain behaviour in numerous situations in psychology. The study used this theory in a new geographical, economic and administrative environment; Uganda. This theory has proved relevant in explaining psychological, sociological and economic behaviour; specifically tax compliance. The TRA was revised to include a new construct of perceived behavioural control, which turned into the theory of planned behaviour. This could not be studied due to time and logistic constraints. Therefore, there is a need to investigate if this revised theory can explain tax compliance behaviour better. Practical implications The paper suggests that tax administration efforts and policies should consider the social-psychology aspects of the taxpayers to improve tax compliance. Originality/value This study adds a new arena of explaining tax compliance from a theory commonly used in psychology to a new setting in finance.

Purpose This study aims to investigate the certainty of small business (SB) taxpayers about the presumptive tax law concerning the assessment of income tax based on gross turnover and how this impacts their income tax compliance. Design/methodology/approach The study adopted the exploratory research design. The saturation point was attained upon interviewing nine owners of SB enterprises, eight tax officers from the Uganda Revenue Authority and eight tax consultants. Themes were identified and explained using verbatim texts from the various interviews. Data were analyzed using the content analysis technique. Findings The findings indicate that SB taxpayers are uncertain about the nature of the presumptive tax, that it is assessed based on annual sales, indicators used to determine gross turnover and their actual tax liability. This has occasioned resistance to the tax system and inhibited voluntary compliance. SB taxpayers thus opt to wait for the tax officers to make tax assessments. However, they have used this opportunity to bribe or bargain with tax officers to pay low amounts in tax or no tax at all. Thus, policymakers and revenue authorities ought to concentrate on creating massive sensitization of the law on presumptive tax, in this case, the existing tax base on which the tax is imposed and its elements to improve income tax compliance of SBs. Research limitations/implications These results are relevant to policymakers and Revenue authorities in developing countries, especially in Africa, in improving income tax compliance of SBs. Originality/value This study examines the contribution of certainty of the income tax law on the tax base (gross turnover) on which presumptive tax is imposed to income tax compliance of SBs, which has hardly been covered in previous studies.