Property tax causes uproar

Oct 10, 2007

Residents of Kira Town Council are crying foul following the announcement of new property tax rates recently. The council announced the rates through Katuram and Company, a private firm contracted to collect the new tax.

By Madiinah Sebyala and Joshua Kato

Residents of Kira Town Council are crying foul following the announcement of new property tax rates recently. The council announced the rates through Katuram and Company, a private firm contracted to collect the new tax.

Residents in the town council claim the rates are high. Besides, the tendering company even rated houses that are not used for commercial purposes.

However, Lilian Nakamatte, the town clerk, says the rating was done on all houses, so that council does not spend more money to carry out evaluation when they are rented out in the future.

Local governments are empowered by the Local Government Ratings Decree 2005 to impose property tax on property within areas of their jurisdiction.

Initially, the tax was supposed to be paid by every house. Two years ago, it was amended and houses used for commercial activities are eligible for the tax.

The decree also gives local governments powers to recover payments in whatever way possible, including selling off the property of the defaulter.

The rating is done on 75% of the amount of money that a landlord collects from a house a year, for example, if the landlord collects sh1,000,000, the tax will be levied on sh750,000. The percentage varies from 1% to 12%, depending on the decision by the town council.

Nakamate said: “The regulation to pay property rates is there and legal. However, only houses that are rented out and used for commercial activities should pay the tax. There is also room for appealing if one feels aggrieved with the way his or her property was rated.”

Katuram and Company officials said only commercial houses were rated as the law says. Below is what some residents said about the tax.

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