Property Tax is a Dependable Source of Government Revenue.

In this short piece, ESV Abdulsalam Olayinka Abdulrasaq, a registered Estate Surveyor and Valuer with the Railway Property Management Company (RPMC), argued that property tax is a dependable source of government revenue.

With the fluctuations in the foreign exchange market, dwindling oil price, gloomy global economy, property rating remains one of the major sources of revenue to the government through the payment of property taxes that mobilise revenue to the government coffers for economic growth and development.  These taxes are imposed on the property owners by the government, and in most cases, property tax is paid on annual bases.  Available data and recent studies have it that property tax has become one of the most reliable sources of government revenue in recent times. In most developed economies of the World, the government depends heavily on property tax for the provision and maintenance of basic needs of its citizens. Unfortunately, in most developing economies like Nigeria, some state and local governments are yet to maximize the benefits of property tax, a very reliable source of government revenue.

In Nigeria, states and local government area councils that have become adept in the collection and management of property taxes have over the years increased their internally Generate Revenue (IGR), thereby making the states to depend on its IGR in the discharge of its economic obligations to the state and its citizens.  The tax authorities in such states have been structured and empowered to be the mainstay of the states’ economy.

One major factor bedevilling the administration and collection of property tax is tax evasion. When property tax payers fail to meet their tax obligations to the government it becomes a drawback in the generation of the needed revenue to effectively run the affairs of the state.  Tax evasion, simply defined is the illegal non-payment or underpayment of taxes that are due to the government. This has remained the bane of most governments as tax evasion is inimical to economic growth and development, and those who indulge in it are simply economic saboteurs.

On the way forward in making property tax work for the government and its citizens, the modus operandi of administering and collecting property tax should be revamped in line with the global best practices and modern-day property tax collection. Internal mechanism aimed at checking corrupt practices among tax authorities should be put in place.

Advocacy programmes aimed at educating the property owners and managers should be developed and implemented to the latter. The economic dangers of not paying property taxes, and the legal implications should be part of the advocacy programme.

In this time of global economic down turns, taxation will play a key role in the development of states and countries as well.  Thus, all stakeholders should rally around the effective administration and collection of property tax at all levels of government. Property tax payment should be seen as our common effort for our common wealth.

ESV Abdulsalam Olayinka Abdulrasaq, a registered Estate Surveyor and Valuer with the Railway Property Management Company (RPMC).