Collection of property tax to be decentralised — Minister

The government is to decentralise the collection of property tax to metropolitan, municipal and district assemblies (MMDAs) before the end of this year, the Minister of Local Government, Chieftaincy and Religious Affairs, Ahmed Ibrahim, has said. 

He said the move would ensure that local assemblies were given stronger financial backing to undertake development projects instead of mostly relying on transfers from the central government.

The Minister, who is also the Member of Parliament for Banda also said that the government would empower local assemblies to resort to municipal bonds to finance capital projects going forward.

“The President promised to decentralise the property taxation system and send resources to the grassroots for balanced and equitable development of the country.

“The people of Ghana gave him an overwhelming majority of votes, so we cannot sleep on this reset agenda," he said.
 

Event

The minister said this at the opening of a three-day workshop on property tax administration in Accra yesterday, organised by African Cities Research Consortium (ACRC), a collaborative research initiative addressing critical urban development in African cities.

It was on the theme: "Transforming urban property tax administration for improved delivery of valued public goods and services."

Participants were drawn from ministries, departments and agencies (MDAs) in Ghana, Kenya, Uganda, Nigeria and Zimbabwe.

They are expected to share best practices and case studies from successful reforms across the continent; explore digitisation experiences and identify strategies for implementing sustainable digital reforms, including fostering collaboration among policy makers, tax administrators, researchers and international organisations to advance property tax reforms.

While property taxation is a viable source of revenue for African countries, the sector is challenged by inadequate valuation systems, incomplete property registers, and weak enforcement mechanisms.

The property sector remains underdeveloped, causing the countries to wallow in resource constraints to undertake development projects.

Implementation

The Greater Accra Regional Minister, Linda Obenewaa Akweley Ocloo; the head of project delivery at ACRC, Irene Vance, and a senior lecturer of Land Management at the SD Dombo University of Business and Integrated Development Studies, Dr Samuel Biitir, all called for the implementation of a robust property tax regime capable of raking in the needed revenue for sustainable development.

They said that within the context of dwindling donor support, it was important for local assemblies to adopt innovative reforms backed by digital solutions to unleash the potential of the property tax.

In separate statements, they stressed that the adoption of an ingenious property tax administration module that best suits the country would further help local authorities to deliver on their onerous responsibility of addressing development challenges such as sanitation, health care, and delivery of social interventions.

Relevance

Ms Ocloo, whose speech was delivered on her behalf by the Regional Economic Planning Director at the Greater Accra Regional Coordinating Council (GARCC), Jemima Lomotey, said the workshop would bolster ongoing processes by local assemblies to adopt digital solutions for effective property tax collection.

She said her outfit would support metropolitan, municipal and district assemblies (MMDAs) within the region to deploy innovative programmes to improve domestic tax mobilisation.

Dr Biitir also said that for property tax collection to be effective, there must be depoliticisation of the process.

"Here in Ghana, it is difficult for the assemblies to collect property tax because of partisan politics. During election years, the assemblies cannot collect the needed property tax because of politics," he said.

He underscored the need for an enhanced digital addressing system to boost property tax collection.

For her part, Ms Vance said while African cities such as Accra, Ghana; Lagos, Nigeria; Harare, Zimbabwe; Kampala, Uganda and Nairobi, Kenya were fast growing, the lack of an effective property tax system was a hindrance to unlocking their economic potentials.