Chris Jordan So welcome to the African Cities podcast. My name is Chris Jordan. I’m the communications manager for ACRC. And today I’m joined by Dr Samuel Biitir. Samuel is a lecturer at the Department of Land Management at SD Dombo University of Business and Integrated Development Studies. And he’s somebody who’s been very closely involved with the African Cities research right from the start. In Accra, he led a work around land and connectivity. And is currently following that up initially with a workshop around property taxation in Accra. And before that workshop happens, we wanted to invite him onto the podcast to have a chat about all the issues surrounding it. Samuel, welcome to the podcast.
Samuel Biitir Thank you very much, Chris.
Chris Jordan Great. First question from me is could you just give us the broad context? Why does Accra need a property tax and the revenues that would come from that?
Samuel Biitir Yes, thank you once again. Accra is a growing city. There is this phenomen of urbanisation and a lot of people are moving and the city is sprawling and this creates both challenges and opportunities. From the opportunities, there’s creation of employment, people moving to find job opportunities. But challenges with this include deficit in infrastructure provision. And this includes basic services, such as access roads, connecter roads, sanitation, waste management and, generally, basic services are not being provided to meet the needs of the growing population. And as a city, the challenge has always been, where you find the money to provide all these basic services. And thankfully enough, there are so many revenue tools that have been made available to both the national government and local government. From the national government level, they go through taxations of landed property, which we generally refer as property taxation in general. That would include stamp duty, capital gains tax and other land transaction instruments. At a local level, there are also instruments that are given to local governments. In this case, we normally would call in the Metropolitan, Municipal and District Assemblies. And they have the opportunity of mobilising these resources to be able to provide these basic services. So I think this is where we are in Accra. Definitely we need some kind of locally or, if you like, internally generated revenues to be able to support national government activities in providing the trunk infrastructure. So basically, property taxation would be used to support basic infrastructure like connector roads, access roads, sanitation, waste collection, at mostly the local government level.
Chris Jordan I know from the Accra city report that you were part of, there’s no shortage of challenges and needs across the growing city. But this is also critical across many African cities, right? ACRC has also published research recently, looking at municipal financing. And I think across every single city that we looked at, there was a great need to increase more local city funding. So yeah, I think your workshop on property tax has come at a timely time, both Accra and hopefully maybe the rest of the region too.
Samuel Biitir Sure.
Chris Jordan So could you just outline what the current situation regarding property tax is in both Accra and Ghana more broadly?
Samuel Biitir Yes, so the current situation of property taxation in Accra, basically has to do with the local governments. The local governments have been mandated to mobilise internally generated revenues, of which property tax is a critical component. So as we speak currently, the local authorities are unable to mobilise adequate revenue from property access. Basically out of some reasons I call, there are often common reasons across cities, especially in Africa, first has to do with the evaluation of those properties. So mostly the assemblies do not have up-to-date valuation rules, where they can base on it to ask the properties. So our data evaluation rule is number one. Number two has to also do with the challenge of collection. After you have the valuation rule you must label the rates, but how do you collect it? So what has been happening in some of the local governments have had some instances where they partner with private IT companies that develop some kind of software, and they are able to collect digitally. But in very few instances. Others depend on manual collection, where people have to move from house to house to be able to mobilise property taxation. So this makes it very difficult to actually mobilise property taxation. Apart from this, we also have administrative challenges in terms of capacity to be able to mobilisea propety taxation. That said, we also have this other challenge of, when you have mobilised these property taxes, revenues, what do you use it for? So the other aspect of it has to do with citizens. You find that some citizens complain we’ve been paying property taxes for a number of years, but we really don’t see any services that have been implemented by the local assembly, so they also would resist that kind of tax when they don’t see the benefits pf paying their rates. So these are broadly the general challenges that are facing this local government in Accra and then across African cities as well.
Chris Jordan Yeah, I know one of the things that the Accra report really brings out is this quite complicated and often fractious relationship between national governments and the local governments that are running Accra. How does this work across property tax?
Samuel Biitir Yes, indeed, it’s a challenge. It’s a challenge for property tax mobilisation, as we speak. Previously, local governments were given that mandate. In fact, they still have the mandate to collect property taxation. But in the last few years, the government came out with a certain policy that sought to centralise a collection of property rates from local assemblies. So they entrusted the collection to the Ghana Revenue Authority. And the Ghana Revenue Authority is supposed to collect from all the local government authorities and then later on they can disburse it back to them. So that became a challenge. So you have a national level developing a centralised system that all local government authorities are supposed to log onto it, and then the collection is given to the Ghana Revenue Authority. So you have local governments just sitting there, and then the Revenue Authority doing the collection. The research that has been done so far, we see that this does not appear to be a very effective way of doing it. In fact, some assemblies opted out. Even though it was a government direction, but some assemblies opted out that they would not because the law strictly mandates local authorities to collect. So you would find that the central control, trying to control the local authorities in terms of the collection is challenging. Some local authorities are resisting, but of course if you are the chief executive of the local government, and you are appointed by the president, you find it difficult to challenge such a policy. So as we speak, we are still in that challenge. It’s not well sorted out and I don’t know whether the new government wants to toe that line, but this is what is happening now – so this decentralised collection by the Ghana Revenue Authority.
Chris Jordan Is that sense of blockage true right across Ghana? Are there any other cities that have managed to make this system work? Or is Accra typical?
Samuel Biitir I think it’s across all the cities, across all the local government assemblies, but Accra seems to be unique in the sense of the volume of properties that you find and then the number of local assemblies that are there. I’m also aware that in the Ashanti region, one of the municipalities or metropolitan areas refused to log onto the central collection system. So you have at one end, people are dissatisfied, they are not able to register their protest because simply you are appointed by the president and the chief executive and you cannot be seen to be opposing your policy of government. But that was the last government between 2020 to 2024. This new government has not yet taken a stand on whether to continue with this central collection but whatever it is, we hope that through this workshop, issues will come up for discussion and we will see the best way forward to handle the central local system of collecting property rates.
Chris Jordan So it sounds like that the workshop is well-timed both for Accra and potentially other cities in Ghana too. So what else are you trying to do with this workshop? Why is it useful to have this gathering now?
Samuel Biitir Yes, so with this workshop, what we intend to do, generally, the problems of property taxation cut across most cities in Africa. And the problems are common as I mentioned earlier, valuation rules, not up to date, collection is a problem and a risk. Although I’ve also seen that, from the literature we read and from the case study we have also said it, you would find that there’s some good cases in some cities in Africa that they have experimented and it appears to be working. For example, Sierra Leone, Freetown, we have some examples there. Then in Senegal, Benin and the rest, we’ve seen that the cities are implementing some workable solutions. So with this workshop, we intend to learn from these case studies, what is it that they are doing differently than what we have done? What lessons can we learn from those case studies? And how would those lessons help us to forge a certain reform that would meet our context-specific needs. So that is one area. Then we have also seen that there’s this innovation in using digital tools to do both the valuation up to the collection point. And many cities are using this to change this, the narrative. We have seen in cities where they have used digital tools to map out the properties, identify the properties and then also include in the digital tools the payment structure. And then, how you even make payments online. So all these are innovations that are coming up and we hope that with this workshop, we have carefully selected the presenters from all the divides from the government’s perspective of property taxation, then we have looked at the administrative issues, which digitisation is part of it. And then we have also looked at transparency and accountability. So these presenters, our hope is that they would share these case studies from other African cities and other international experiences. And then this would form the basis. The other aspect is that the Ministry of Local Governance and Religious and Chieftaincy Affairs is also key stakeholder in this workshop and they’ll be coming, they’ll be duly represented. And they will listen to all these presentations. And then after that, we would probably chart a new path.
Chris Jordan Sounds good. I know you’ve got high hopes for the workshop. I know it’s been super popular in terms of people applying to get in there. So yeah, I hope it goes really well and we can hear from you afterwards. I’d just be really interested to dig in a little bit more about how your original work for African Cities around the broader land and connectivity issues in Accra has led you to this stage and what that’s revealed. I know security of land tenure seemed to come up as a real issue and obviously there is around 38% of residents in Accra are based in informal settlements. So how does this sort of security and the high number of informal settlements – does this pose a challenge for effective property taxation?
Samuel Biitir Yes, so my work on the land and connectivity at the foundation stage. Basically, we dealt with, I think, three areas. We were looking at land value capture, we were looking at property taxation, we were looking at connectivity. And in connectivity, we meant both road connectivity and digital connectivity. But the digital connectivity seems to have played much role in what we did. And what we found out, essentially, the land tenure issues are actually a challenge in the city. We found out that there are many areas people are resorting to their own way of protecting their land rights through what we call land guards. And the land guards would actually protect somebody’s property, sometimes positively and sometimes negatively. Negatively – in the sense that in that attempt to protect the land, dispute would arise and then sometimes it ends up in fatality. So that was another area that we found. And the phenomenon of landguardism was a big challenge in the city because of tenure issues. And basically because landowners are trying to cash out on the urbanisation issue. So they sell the land to one person, and then another place, another time, the same piece of plot is sold to another person. So you can have one plot sold to more than one person. And then that creates a lot of challenges. So that was the area of the land tenure, things that came up. And then we also looked at land values because we’re interested in the land value capture, in the sense that rising urbanisation and increased infrastructure often have a bearing on how land values go. So we sort of found out why, what actually causes land values to increase, in the case of Accra? What we found out was that actually, road infrastructure seems to play a role, and that is what the conventional literature will tell you. But we found other factors that seemed to play more roles in land value increments, and one of them was the fact that there is speculation infrastructure investment alone can push up land values. So that was one of the findings, so we noticed that in areas that were certain pronouncements that the government intends to build this kind of infrastructure, already land values should push up because of the mere announcement of this. What also came up was also that in the land transaction process, we have land agents, estate agents and brokers. And sometimes the part that they have, they are privilege to certain information. They can, in a way, influence the pricing. So they were also a factor pushing up land values in that area. So these were the things we found out that, out of the conventional literature, it doesn’t actually mention this, but this came up in the process. Then when it came to land and property taxation, what’s interesting, as I mentioned earlier on, the central local government political tension became a critical issue in terms of mobilising it. And the case was … there was one donor-supported programme that was supposed to change the face of property taxation. But some way, somehow, along the line, they had to pull out because of this government’s rule of centralising the collection. So that project came to a stall, and then that created a problem with property remobilisation. And then as I mentioned earlier, there are also areas that are fast developing, but those areas are underserved with basic infrastructure. So you have this group without access, the area is expanding, but there’s no road network. Individuals will have to provide their own access to their places. So this became another challenge that affected property remobilisation. The digital connectivity realised that many of the land sector institutions had deployed some kind of digital tools to do property registration, to build the database. But most of these were just initiatives that started but never got fully implemented and partly also due to the politics of it. So this government started setting projects, and the [inaudible] office, it’s not able to complete and our government [inaudible]. So that kind of disjointed and discontinuous investment also affected most of the city’s resources.
Chris Jordan Interesting. At the moment, the proposals around property taxation – what would they mean for people living in informal settlements, who are often existing on on very low precarious incomes, is it something that they would be expected to pay?
Samuel Biitir Ideally, the law says that any property – in fact, our laws specify the kind of properties that are supposed to pay, and here we are referring to only building and improvements. So if your structure can be classified as a building improvement, ideally you are supposed to pay property tax. But we are also much aware about informality in the city. Like the fact that certain people just put up kiosks and other structures. Of course, they will not be able to pay property tax. And once [inaudible] secures on it, though the details of it will be captured but said people are not likely to be properly taxed. So what would happen is that people living in informal areas – and I think we have to be specific here, if we’re talking of informality, at it at its full definition than the whole city of Accra would be informal. But we’re looking at informality here to just apply to those who are living in informal settlements, settlements that are not recognised by the law and precisely the Agbogbloshie and the other squatter settlements. Otherwise, all the other parts of the city will be eligible to pay property tax.
Chris Jordan And you talked, before you mentioned the mapping efforts that need to go on to identify all the properties. Does that have implications for people’s land tenure as well? Is this something that could be worked hand in hand to boost land tenure security?
Samuel Biitir I feel for the purposes of property taxation, there are good reasons why the land is not taxed, it’s only the property. And when we go back into the history and the literature says that because of the complexity of our land tenure system, our forefathers decided that it would be wise to tax only the improvement. So the land aspect is actually not taxed, it’s just the improvement that is manmade. So because the land is not taxed, we may not encounter most of the challenges in the land tenure’s [inaudible]. It’s just a property. So once a property has an owner, so it is the owner that pays the property rates. So we have not actually delved so much into the land tenure issues because of the legal definition of who is supposed to pay the tax and then the tax base, which is basically on improvement.
Chris Jordan Okay. Yeah. I guess, regardless of that, all new taxes are always politically contentious and they always regularly receive pushback from various factions in society. Do you think this is something that Accra can navigate?
Samuel Biitir Chris, you are right. Nobody wants to pay taxes. Everybody if you have your own way, you would want to evade. Yes and then there are issues from the policy level to those who are paying. And it’s always a challenge when you are introducing or trying to enforce something that is not working. We are aware of those challenges. But what we believe is that this workshop would actually be an eye-opener sharing these case studies from other countries who have similar contexts, if you like, with us and then such case studies that seem to be working. So the lessons we will learn from the case studies and the presenters that are willing to share their expertise with us would go a long way to help us. At the end of the day, we cannot do it by ourselves. There’s a need for some kind of collaboration from the government level to the implementers and then to experts and academics like some of us. So we are looking at a scenario where we create a win-win situation where we fund coalitions and collaborations. From civil society to the government. And then we hope that when the city authorities and governments already they know the implications of this, that we can mobilise a lot of revenue. And when they see that, we’re able to let them know these challenges can be handled. Once it’s handled in other countries, it can also be handled in Ghana here. I think they’ll be more willing to open up a dialogue between the academia, the civil society, and then the politicians as well for us to engage. At the end of the day, I believe that we would all see that it is useful to do some kind of a fund so that property taxation can actually give us the desired revenue that we all are looking for. So it’s not going to be easy, but I believe in the long run we would understand the need to work together.
Chris Jordan Yeah, and I guess, as you’ve mentioned briefly before, a key part of this is building trust between local authorities and residents, so people see what increased revenues are actually spent on, that they can be confident that money is going back into water, sanitation, roads, the basic services that people need and rely on. So do you think that that will happen, has the potential to happen?
Samuel Biitir Yes, so I think yes, it’s possible and it’s likely to happen. Citizens’ resistance is always as a result of visibility. They are not able to see what the taxes are used for. And so with this workshop we hope that the discussions that would come up would help us to carry everybody on board. One, from the local government level, there will be a discussion on how do we use this revenue that is mobilised, to the extent that people can see visibly that this is what you are using the money for. If people are able to pinpoint, okay, this year we paid so much in property taxation, and then we can pinpoint that out of what we pay, this is what was down with it, this is what was done with it. It doesn’t mean that assemblies are not actually using it, but they probably don’t let people know. So accountability process, stakeholder engagement, carry people along, let them know that after you have mobilised this much, probably in your community we didn’t do this much but other communities benefited. So it’s about engagement and carrying people along. So with this workshop, all these issues will come up. I think there’s a presentation on transparency building trust and the rest. And we have invited a number of assemblies to be part and learning this would also help them improve on their communication on how taxes are being used. And once they’re able to step that one our citizens will be happy and then would have some confidence in assemblies that they are able to use their taxes for what they intend to use it for.
Chris Jordan Thanks. And I just finally maybe wanted to come to some of the new ideas and innovations that you’ve mentioned. Quite a lot of those focus around digital tools or digital techniques. I just wondered if you could say a little bit more about some of those and from a citizens’ side of things, is there a danger that too much of a focus on digital will exclude some people and increase digital divides within society, or do you think there are ways around that?
Samuel Biitir Yes, of course, with every innovation that is coming, there will be some fallouts. And we are aware of it. I think one of the presenters is looking at the promise and the perils of technology in property rating. Of course, trying to capture everything digitally in a country where that’s you really do not have a good street-aggressing system would leave some people out. But whatever innovation you bring, it has to be proven based on ground data. So, digitalisation will have to go with ground troops in to verify what is there. And then whatever is there, then you can levy it. So those challenges would come, but at the same time, this presentation would throw more lights on how others have done it. And then how they managed to navigate their fallout and how they got to where they are. So the innovations are there. But one thing that is important is that these innovations must be tied with a political strategy. There has to be political buy-ins. If there’s a political buy-in, then it’s more likely to succeed. So that is what we are looking out for, that innovations are there, but let’s align those innovations with political-strategic buy-ins so that we can succeed.
Chris Jordan Yeah. And you’ve mentioned this is potentially an opportune time with the new government and a new policy regime coming in. From a personal perspective, where would you hope that Accra might be in say 12 months’ time?
Samuel Biitir Ah right. Personally, I think we have come in at the right time. And I believe this government, the government means business. I think in the budget there is a mention of property taxation and the government seems to be serious with it. So this workshop would further show more light on the good aspect of it and what can be done to make it work. It is my hope that the government would see the good side of this and then as we engage with them, they will be more positive. And they’re willing to collaborate and then partner with assemblies and then academia and experts in the field. So my hope is in the next 12 months we might see some kind of slight changes being introduced depending on government’s willingness to let the process go. We might not see so much being done. But there will be some steps that would carry that would finally be the game changer in property taxation in Accra and the cities of Ghana in general.
Chris Jordan Well, it’ll be really interesting to see what pans out. And Samuel, thank you very much for joining us today. We hope that the workshop goes really well, that it’s a really fruitful conversation. And we’re really interested to find out what happens next, what ideas get taken on, how the politics, from the senior level to the informal settlements, how that all shakes down. And we will be following this story closely, so thank you very much.
Samuel Biitir You’re welcome. I’m grateful for the opportunity.
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