Next chart detects the relationship between avoiding taxation and remaining in the informal sector: “I prefer to avoid taxation in the formal sector”. The chart shows that most people disagree with the statement. Only 10,9% from respondents (32) agree with the statement. Hence, most people who are deterred from joining the formal sector, are deterred because of the hurdles and hassles of registering a company not by taxation.
Figure 2.9: “I prefer to avoid taxation in the formal sector”
We conclude this section by tracking the government’s capability of enforcing laws and regulations related to registering companies in the formal sector. “Governments lack the administrative capacity to enforce laws and regulations”.
Figure 2.10: “Governments lack the administrative capacity to enforce laws and regulations”
This expresses that 37,9% of respondents fnd that their governments lack the administrative capacity to enforce laws and regulations related to registering formally companies and following up on them. The following chart shows how difcult it is for small businesses to approach fnancial institutions: “In general, I fnd it difcult to approach a bank for a loan”. Indicating that a majority (56,5%) share the same opinion about how difcult it is to approach banks for a loan.
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