Taxation of vacant urban land: From theory to practice
Astrid R.N. Haas, Mihaly Kopanyi
In 2011, with the inception of the Kampala Capital City Authority, the decision was made to establish a dedicated Directorate of Revenue Collection, whose mandate was to focus on improving the revenue performance within the city. In the few years of its existence, it has managed to fundamentally transform the revenue administration and procedures leading to increases in own-source revenue by over 100% in four years (Kopanyi 2015). Much of this increase in revenue was attributable to improvements in administration, which although provide sustainable revenue streams in the long-run, are generally represent one-off increases. Therefore, the KCCA is now to further expand its sources of revenue, it is exploring further approaches on how this can be done. Following a comprehensive assessment of revenue performance, capacities and future plans of the Directorate of Revenue Collection, conducted in October 2015, Kopanyi (2015) highlighted several potential new sources of revenue, including a tax on vacant land. This type of tax is common practice in many cities around the world. Local governments not only tax land, but often set higher rates for vacant land in urban areas on the basis that, aside from increasing revenue, it may have further benefits such as reducing speculation, incentivising land transactions to ensure an overall more efficient usage of a scare resource.
Event: Land Governance in an Interconnected World_Annual World Bank Conference on Land and Poverty_2018
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