Local authorities and tax collection: Experimental evidence from Tanzania

Mwaijande, Francis

doi:10.1257/rct.4875-1.1

Cited by 1 publication

(1 citation statement)

References 0 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…In most sub-Saharan countries, people with political and economic power do not want to pay taxes, and tax compliance is low for other people [1][2][3]. On average, property tax contributed to less than 0.5% of the gross domestic product (GDP) in African countries [4]. Tanzania-specifically, Zanzibar-is in a similar situation.…”

Section: Introductionmentioning

confidence: 99%

Designing a Valuation System for Property Tax: The Case of Zanzibar, Tanzania

Kang

Kim²

2022

Land

View full text Add to dashboard Cite

In most African countries, property taxes fail to efficiently generate sufficient revenue to provide adequate local services. One of the crucial reasons for this is that market values are not reflected in the taxable value because of a lack of property transaction market data. When market data are inaccessible, buildings are evaluated using the replacement cost method, which does not reflect locational values. In this study, we examine methods to improve the valuation system using the case of Zanzibar, Tanzania. We recommend the simple and systematic mass assessment model, with details that can be used to derive locational values for all taxable buildings and improvements. In this model, (1) the taxable areas are divided into sub-regions based on land value stratification, (2) land value ranges are set for each sub-region, (3) land value determinants are identified, and (4) land price ratio tables for the identified land value determinants are created. In this assessment method, individual valuers play an essential role in capturing locational values because their knowledge and experience are helpful in dividing the area targeted for property tax assessment into several regions, thereby reducing the intraregional variance in land values. Improving the valuation system is one of the key factors in determining the importance of property tax as a revenue generator in developing countries.

show abstract

Section: Introductionmentioning

confidence: 99%