Prime
Gulu City seeks to mobilise Shs3.7b from property tax
Low tax collection remains a significant challenge for newly established cities such as Gulu. Photo / File
What you need to know:
- The projection is part of Gulu City’s broader plan to boost its revenue capacity and work towards becoming a self-financing city
Authorities in Gulu City anticipate to raise at least Shs3.7b from property rates in the 2023/24 financial year.
The projection is part of Gulu City’s broader plan to boost its revenue capacity and work toward becoming a self-financing city under the Domestic Revenue Mobilisation for Development strategy.
Speaking in an interview, Mr George Kidega, the Gulu City finance manager, said the money will be mobilised from about 3,200 properties, which a recent mapping concluded they have a commercial element.
“We project to mobilise at least Shs3.7b. If we achieve 100 percent compliance, then we shall obviously hit our targets. We are already studying the implementation to see where we are and how we shall manage,” he said, noting that the mapping and valuation process, which was completed early this year, had helped to incorporate new properties into the taxable fold.
Low tax collection has been a significant challenge for newly established cities such as Gulu, hampering efforts to enhance service delivery.
Consequently, government is counting on the Domestic Revenue Mobilization for Development strategy to increase revenue collections among local governments from a combined sum of just Shs50b to at least Shs300b in the next five years.
However, the Local Government Finance Commission recently stressed that achieving the Shs300b target will require certain measures, among which include maintaining up-to-date property registrations, computerising property registers for efficient and comprehensive collections, consistently valuing properties, and automating property rate administration using the Integrated Revenue Administration system.
Mr Kidega said that the authorities in Gulu City had agreed on an 8 percent property tax rate.
Property rates constitute a substantial source of revenue, of which at least 85 percent is channeled into local government services such as road infrastructure, drainage and street lighting, among others.
Government, through the ‘Services and Fair Tax for Property Owners’ campaign organized by RippleNami Uganda with the support from Usaid’s Domestic Revenue Mobilisation for Development activity has been conducting sensitization with the aim to strengthen dialogue and engagement between administrations and property owners to reinforce the social service realisation.
