The mysterious property rent

Halima Nankinga, a resident of Maganjo, Nansana Municipality woke up to the shock of seals on her business shops.

On checking properly, there was a collector’s note reminding her of the two-year unpaid property rent worth Shs960, 000.
When she approached the municipality headquarters, Nankinga was given an explanation and asked for a payment plan which she discussed with the authorities, who removed the seals from her premises upon paying a property rent for a year.

The phenomenon of property rent puzzles many but Patrick Kaweesi, the town Clerk, Nansana Municipality says this rent is set for landlords with houses that are rented or used for commercial purposes. “The valuation was done about two years ago basing on the valuation role of the property tax and we intensified the collecting of this rent in January. Everywhere we go, we first, do sensitisations but people are usually negative when it comes to paying tax,” he says.

Procedure
The amount is not random. Kaweesi says the government values your building and gives people values which the municipality bases on to charge 8 per cent of the rent value.

“We then engage the collector to enforce the payment of the money by putting seals on those that have not yet paid, the valuation role is in place and if anyone has a complaint, we listen to it at the division headquarters,” he says.

Kaweesi adds that this is the second year of levying this tax but most people last year did not pay and it has caught up with them this year.

“The money is paid on the municipality bank account and the collector only helps us to enforce payment by putting seals on these houses, we encourage people not to default this taxi because it is for the development of our community,” he says.

Challenges
The challenge is that the municipality has just started and it is hard for the public to remit the tax willingly.
“The fact that it is a direct tax, the payers feel the pain directly but I think it has been well received where we have managed to explain to the people and we are still doing this,” Kawesi notes.

He adds that the town council is using the money to work on projects. “If you went to Nabweru now, the graders are already working on the roads now that we have realized some money. Before we were only surviving on money from the central government and the road constructions were never effective due to limited funds,” Kaweesi explains.

About the law
The tax that was passed 2014 gave a mandate to cities and municipalities to increase on their tax base for purposes of complementing the district budgets for development.
Steven Senkezi, of Senkeezi –Ssali Advocates and Legal Consultants says this is not a new thing and it is a civic responsibility; paying it is just like paying any other taxes.

“This is rent charged by the area authority, ideally a municipality or a city on the owner of commercial premises and rental premises. When you have houses that you put on the market to be occupied, then you are legible to pay property rent to the municipal officials. What usually happens is, it is tasked from the owner of the premises who then transfers it to the tenants,” Senkeezi explains.

How it affects the landlord and tenant
Senkeezi says the tenant will end up paying more money than they have been paying because the landlord has to get this property rent from them.

“Property rent is reflected in the amount that the tenant pays. The landlord hikes the rent in order to cover the expense of property rent; if it was Shs400, 000 then it can go up to Shs450,000 where the Shs50,000 increment is set to cater for the property rent,” he says.

More so, the legal consultant adds that the landlord has also got some obligations such as payment of the rent. Therefore, if any authority serves notice, it’s the landlord’s responsibility.
He, therefore, states that on such grounds, the tenant has the right to demand that the landlord too makes sure that property rent, ground rent and other property levies charged by government are paid by the landlord.

When they do not pay
There are cases when the landlord fails to pay this money and with this, the authorities seal off the premises until the rent is cleared. Senkeezi says that if they seal off the premises for failure to pay and then the landlord seals off the place, it is compounding the offence by committing another offence.

“A landlord will either pay the rent immediately or enter into an agreement with the municipality that they are not able to pay now and ask for a grace period to do so this since various crime charges can be put on them for their unresponsive actions,” he notes.

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