[Source: The Standard, by Benard Sanga]
Property owners in Nairobi could end up paying 50 per cent more in land rates if MCAs approve a proposal by the county government to review the land valuation roll.
Nairobi City County Government officials yesterday said they intend to cap land rates at 0.13 per cent of a property’s value.
This new formula will replace the current practice where property owners pay 25 per cent of the land’s value as determined by the 1980 valuation roll.
Urban and Economic Planning Executive Washington Makodingo said a new land valuation roll has been completed and a proposal to cap the rates tabled in the county assembly.
A valuation roll is a legal document that assigns a value to all properties in an area, with the objective of generating land rates on an equitable basis.
It is projected that if the proposal sails through, the county will collect Sh10 billion from property taxes, up from Sh3.2 billion collected in the 2018-19 financial year.
The executive said land tax was one of the county’s 10 main revenue streams, and that Governor Mike Sonko’s administration expected to generate more income to meet its Sh17 billion revenue target.
The county had earlier proposed to cap the rates at one per cent of property value, but Makodinga said they reduced the amount to take care of the interests of property owners in disadvantaged areas.
During the meeting, it also emerged that parastatals and other national government agencies were the biggest defaulters on land rates and parking fees, denying the county government much-needed revenue.
The rate hike is one of the strategies the county administration is pursuing to meet its 2019-20 revenue target strained by huge pending bills and accrued taxes.
The county executive team, heads of departments and the finance committee are in Mombasa to review the county’s budget. The officials are also deliberating on the county’s plans for the second quarter of the financial year. The review was necessitated by reports that the county had accrued Sh3 billion in taxes, out of which Sh2 billion has been paid.
[Full article: The Standard, by Benard Sanga]
