International Journal of Economics, Commerce and Management United Kingdom Vol. V, Issue 12, December 2017 Licensed under Creative Common Page 726 http://ijecm.co.uk/ ISSN 2348 0386 FACTORS INFLUENCING IMPLEMENTATION AND UTILIZATION OF ELECTRONIC TAX REGISTERS BY SMALL AND MEDIUM ENTERPRISES IN NAKURU TOWN, KENYA James Ogero Nyareru Kabarak University, School of Business and Economics, Kabarak, Kenya jogero1960@gmail.com Patrick Kibati School of Business and Economics, Kabarak University, Kabarak, Kenya kibatip@yahoo.com Philip Ragama School of Business and Economics, Kabarak University, Kabarak, Kenya pragama@kabarak.ac.ke Abstract Electronic tax registers (ETRs) have been operational in Kenya since 2004. This study analyzed factors influencing effective implementation and utilization of electronic tax registers by SMEs in Nakuru town. Compliance cost, training, tax compliance and perceptions were considered. Explanatory design was adopted with a target population of 680 SMEs. Stratified random sampling sampled 197 participants who were administered with semi-structured questionnaires. Collected data was analyzed descriptively and inferentially. Findings revealed that online submission of tax returns eliminates costs of manual filing (mean=4.213), it’s affordable to acquire and install ETRs (mean=3.233), ETR requires continuous systems improvement (mean=4.322), non-registered SMEs are heavily penalized (mean= 3.980) and lack of information affects VAT compliance (mean=4.256). There were significant correlations between compliance cost, training (r=0.763), tax compliance level (r=0.733), perceptions to tax compliance (r=0.756, 0.763, 0.733 and 0.751) and effective implementation and utilization of ETRs. Consequently, small numbers of transactions make ETRs cumbersome, online VAT