Nairobi Deputy Governor Polycarp Igathe. [Photo: Nairobi News]
Property owners in Nairobi may soon start to pay taxes on both their land and the development on them to boost revenue.
Nairobi Deputy Governor Polycarp Igathe has said that only 120,000 properties are ratable yet the county has over 1.6 million buildings.
“Revenue collection is a disaster in Nairobi. We are not compliant, but we are all very entitled to services. Cities are run with property taxes and in Nairobi, these contribute 36 per cent because compliance is very low. We are fixing this through digitisation and amending the valuation roll,” Igathe said in a statement on Tuesday.
He noted that the county currently levies rates on land without accounting for the value of the buildings that sit on the property.
Land rates are a key revenue stream, which fetched Sh2.25 billion against an estimated Sh5.5 billion target in the financial year 2016/17, a report by the Controller of Budget showed, according to Daily Nation.
Igathe said that the Sectional Properties Act 1987 amendments will enable City Hall to charge rates for each property and help develop a graduated rate system that accounts for the number of floors of properties.
"We are working closely with Kenya Revenue Authority, Kenya Power and Nairobi Water Company to integrate our databases and collect taxes more efficiently,” he said.
The deputy governor also called on the public to support amendments to the Sectional Properties Act 1987, which separate ownership of units or sections within a complex.