The study aimed at taxation and its effect on the organizational performance of Kakira Sugar factory and it was guided by the following objectives; To determine the effect of taxation awareness and knowledge on the financial performance of an organization, to determine the impact of tax administration criteria on the financial performance of an organization and to examine the influence of tax rates on the financial performance of an organization. The sample size of the population under study was 40 respondents which determined using the Slovene’s formula. The respondents were selected using purposive sampling techniques. Purposive sampling is a sampling technique in which the researcher relies on his or her judgment when choosing members of the population to participate in the study. Purposive sampling is a non-probability sampling method and it occurs when elements selected for the sample was chosen by the judgment of the researcher. From the findings, the tax payer was aware of where to pay the tax and when had, 25% of the respondents who strongly agreed, 28% agreed, 8% were not sure, 22% disagreed and 17% strongly disagreed. The business entity was aware of the significance of paying taxes had 22% of the respondents who strongly agreed, 42% agreed, 6% were not sure, 19% disagreed while 11% strongly disagreed. From the findings it is recommended that tax administration should reduce criminal aspects of tax evasion with well know tax measures. Further, tax administration should use current tax reform to reduce tax complexity with Tax authorities should focus and help taxpayer during filing taxes returns information.