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Wakiso landlords up in arms over property tax
Municipal Council leaders, LC I,II and lll chairpersons from Nansana Division attend a stakeholders meeting on the Property Tax Valuation exercise on February 7, 2024. PHOTO/ COURTESY
What you need to know:
- They accuse some officials of imposing irregular tax rates that disrupt business.
Landlords and school proprietors in Wakiso District are up in arms over exorbitant property tax levied by town council authorities.
Landlords say the rates are too high yet they are not given enough time to collect rent from their properties.
According to Mr Ali Edris Ssenyonjo, a landlord in Kyengera Town Council, who is also a councillor representing Nsangi/Kisozi Ward, property tax collectors abuse the valuation law and charge high taxes compared to the standard of the structures.
“They [tax collectors] just look at the structures and give you a bill you have to pay minus applying professional skills of valuation,” Mr Ssenyonjo said during an interview on Tuesday.
A school director in Nabweru, Wakiso District, who preferred anonymity, said despite having only six classroom blocks, she has been asked to pay Shs36 million in property tax.
“I cannot pay that huge amount of money because I don’t have it. Sometimes, a school term closes without collecting full tuition from learners because even the parents don’t have the money,” she said.
Nansana Municipality Mayor Regina Bakitte advised all landlords to report to her office with all necessary documents.
“You may find that she [school director] doesn’t have an approved building plan because the highest property tax a landlord pays in Nansana is Shs3 million, who is that official demanding Shs36m from her? ” She asked.
Mr Hamidu Ssenkaaba, the head teacher of Green Light Islamic SS Nansana, said the tax collectors are harsh. “They [tax collectors] forget that we are their bosses, they don’t listen to us yet we have been complying over the years,” Mr Ssenkaaba said.
Mr Ronald William Mukasa, the head teacher of London High School in Nansana, asked the government to revise the taxes or use a clear method of valuing school structures.
He said when property tax collectors are asking for details of the school, they don’t consider the enrollment. He said many of the structures being taxed are empty due to low enrolment.
“Some of our schools have low enrolment and students pay little fees, meaning we cannot be compared to other schools charging a lot of money,” Mr Mukasa said.
Mr Vincent Kasozi Muwonge, the chairperson of Wakiso Traders and a property owner, said they are shocked that even incomplete buildings are taxed.
“They [district ] start taxing the structure when it’s still on the foundation level and they come back again to demand the same money when the building is complete. Let them follow the law governing property tax,” he said.
Mr Festo Tandeka, the Nansana Municipality town clerk, said it is the responsibility of all Ugandans to pay taxes to enable proper delivery of services.
He, however, said taxpayers must be assessed fairly and they should be informed of the tax they have to pay.
“There is a valuation law which those people must follow when making the valuation of the buildings. If they are not following it, that is wrong. For a person to pay tax, must be earning taxable income. We must not take all the income because that defeats the purpose of having a business,” Mr Tandeka said.
He called for more sensitisation of landlords so that by the time one pays tax, they know how much to pay.
“There is also an alternative of paying taxes in instalments to enable the taxpayers to pay the money they can afford at the time,” he added.
Last year, Wakiso District authorities listed more than 80,000 buildings that are targeted for property tax.
The buildings listed include commercial buildings, hotels, recreation parks, and schools that were evaluated and valued during the 2023 valuation exercise.
According to Mr David Kabaale, the Wakiso District principal financing officer, although the council had anticipated raising Shs3 billion from property tax this financial year, the valuation roll has given them hope that they will collect more money since there are new taxable buildings that have been erected in the district.
This Financial Year 2023/2024, the district expects to collect Shs3.6 billion in property tax, according to Mr Kabaale.
In the 2022/2023 Fiscal Year, the district had projected to collect Shs3.2 billion, but only Sh3 billion was realised.
The 2005 Local Government Act mandates urban councils to set property rates not exceeding 12 percent of the rateable value. It is levied on all commercial buildings. The rateable value of a property is 74 percent of the annual revenue that a building owner collects from tenants. The remaining percent is left for the owner to cater for utility bills and renovation.
