The growth of human population across the world as influenced by rapid urbanisation, rural-urban migration and natural causes such as high birth rate have made the need for developing physical, social and economic infrastructure paramount in the 21st century.
The provision of basic amenities to meet the growing needs and demand of the population requires huge financial commitment from the government. Government all over the world seek for sustainable means to generate revenue for public expenditure, and in order to achieve that objective, resources are utilised in a manner that creates wealth.
Land as a resource is viewed as a factor of production which supports the development and delivery of infrastructure for residential, commercial, industrial, agricultural and other special uses. Considering the numerous uses that can be out into land, land-based taxation such as tenement rate, estate duty and others have proven to be a veritable source of revenue generation for developed countries like the United Kingdom and United States of America.
Developing countries especially in Africa are yet to unlock the wealth creating potential of land. Lack of improved system for data collection and the use of inadequate rating methods have been one of the leading challenges confronting countries in sub-Saharan Africa. In Nigeria, property rating have encountered difficulties as most personnel undertaking rating assessment do not always have up-to-date records on property.
The shortage or inaccessibility to reliable data on current market values during rating exercise have affected the accuracy of valuation which have ultimately resulted to low revenue generation capacity accompanied with increased economic losses and hardship.
These limitations have constrained the growth of the economy as the contribution of property-based tax to the gross domestic product (GDP) have remained low or insignificant in developing countries. Innovative property rating using computer-aided system for data collection and analysis such as Geographic Information system (GIS) and Automated Valuation Model (AVM) for mass appraisal of properties in rural and urban centers will facilitate efficiency in updating and monitoring changes in the property market.
The prospect of developing robust economy using land-based taxation will be actualized through improved rating valuation standards enhanced with the application of disruptive technologies in the information and communication world. Public officers engaged with rating assessment should collaborate with trained professionals in valuation practice like the estate surveyors and valuers.
The opinion of estate surveyors and Valuers in rating valuation is indispensable considering their vast experience and deep understanding of property market dynamics. Inputs obtained from these qualified professionals will minimise errors in assessment and ensure valuation accuracy and reliability in terms of true economic values of property in the open market. Land based taxes.
If well harnessed, will serve as a veritable platform for economic growth, sustainability, and prosperity. The renewed hope agenda of our President, Bola Ahmed Tinubu, will thrive if the potentials of land-based taxation are harnessed.
Government must, however, exercise caution by not necessarily increasing the burden of the citizens and ensuring that income realised from land-based taxes are evidently channeled to infrastructure provisions and maintenance. Nigeria through the improved rating taxation involving skilled personnel and advanced information technology (IT) will generate wealth as enjoyed by developed countries of the world.
Esv Opayemi Adedoyin Oyenike (ANIVS, RSV),
Lands & Housing Development Department, Federal Ministry of Housing & Urban Development, Mabushi, Abuja
[email protected]
