City Hall loses Sh188 billion land rates yearly

City Hall loses about Sh188 billion in uncollected land rates every financial year, a report has shown.

The report by the Commission on Revenue Allocation in partnership with the European Union shows that Sh75.6 billion is uncollected in the whole of Nairobi with another Sh112 billion not mapped out in the geographical information system (GIS).

This amounts to a total of Sh188 billion in total rate area not collected by Nairobi County government.

Nairobi County Assembly Budget and Finance chairman Chege Mwaura attributed the billions lost to data gaps.

The Ngara MCA pointed out that there was a substantial rate area not captured in the county revenue information leading to the massive losses.

In 2017/2018 financial year, City Hall collected Sh1.87 billion against a target of Sh4.84 billion with the under-performance attributed to lack of effective enforcement and use of outdated rates record. It improved to Sh1.97 billion in the year to June 2018.

“Nairobi City County Assembly conducted an inquiry into the revenue performance for the various revenue streams and it was evident that the data gaps continued to be a major challenge with regards to revenue forecasting and projections,” he said.

The valuation roll for Nairobi was last prepared in 1982 and has not been updated since then. A valuation roll is a legal document that consists of property information of all rate-able properties within the boundaries of a municipality in this case Nairobi.

Last year, the county government said it was planning to introduce new rates that was to take effect this year January.

Economic Planning Chief Officer Washington Makodingo said last November that the county was targeting Sh500 billion in a crackdown on land rate defaulters.