Taxing the urban boom: property taxation in Africa

Abstract

The growth of Africa’s towns and cities has outpaced local governments’ capacity for service delivery in terms of management, infrastructure, and financing. As a result, many African towns and cities are now faced with a governance crisis. The restructuring of governmental functions and finances has entered the core of the development debate. Policy makers are increasingly aware of the potential and need to mobilise domestic revenues through broad based property taxation. In this Insight we examine political and administrative constraints facing the development of effective property tax systems. Based on experiences from across the African continent, we argue that the major obstacles to improved property rates is not valuation, but poor administration and political resistance to reform. We suggest ways ahead.