UGANDA, Kampala | Real Muloodi News | The Kampala Capital City Authority (KCCA) council has approved new appointees to the city’s valuation court.
One of the new members of the court is lawyer Samuel Muyizzi, who replaces Wandera Ogalo as Chairman. Other newly appointed members are Brian Kayemba and Daphne Muwonge.
The Kampala valuation court is responsible for receiving complaints from those who wish to object to property rates (property tax) valuations made by the city authority.
The court also rules on the reviews of the values and declares tax exemptions where it deems necessary. The valuation court’s decisions are only reviewed by the High Court.
“This court acts as an arbiter, it arbitrates between the aggrieved citizens of Kampala and KCCA, especially about the rates levied against them. I bring justice to this court. This court is for the people. Whereas we appreciate the purpose of taxes to develop Kampala city, we also have to look at the plight of the people, especially during these dire times, so we shall apply equity. The poor people have been exempted. The rich people should pay this tax and I will do it without fear or favour. I will employ social justice, equity in the exercise of the powers conferred unto me as the chairman of this,” says Muyizzi.
Deputy Lord Mayor of Kampala, Doreen Nyanjura, says that the court has been established to serve Kampala residents and ensure they get justice.
“We have received reports that there are some residential houses that are currently charged [property rates]. That is not allowed but the valuation court is here to help you,” says Nyanjura.
Angel Kwagala, the Woman Councillor for Kawempe South, expressed gratitude that the court will streamline property tax issues.
How Much is Property Rates Tax?
The amount of property rates tax an owner pays is based on the rateable value of a property, as determined by a qualified and registered valuation surveyor.
Rateable value means a property’s yearly rental value (regardless of whether the property is rented or not), minus a 22% conservancy allowance (allowance for expenses).
Currently, KCCA levies 6% of the property’s rateable value every year.
The last mass property valuation exercise undertaken by KCCA occurred in 2017. Per the Local Government (Rating) Act 2005, property valuations occur every 5 years. Therefore, KCCA is planning a new revaluation exercise in the coming financial year, beginning July 1st 2022.
After the KCCA completes the valuation exercise, the draft valuation list will be made publicly available for 30 days.
If you disagree with your property’s valuation assessment and want to be heard by the valuation court, you should download and complete the notice of objection to draft valuation list form.
Who is Liable for Paying Property Rates Tax?
Property rates are only levied on commercial properties. It is a tax on all buildings or structures that are used for the purpose of business. This includes residential properties rented out to tenants.
However, the tax does not apply to residential homes where the owner resides, or to vacant land.
Who is Exempted from Paying Property Rates Tax?
In addition to owner-occupied residential homes and vacant land, some other types of properties are also exempted from paying property rates tax. Such properties include places of worship, crematoriums, and public schools.
If you believe your property is exempt and want to notify the court of your exempt status, you should download and fill in a notification of exempt status form.
Is Property Tax and Rental Income Tax a Double Taxation?
Property rates tax is not the same as rental income tax. Property rates tax is based on a property’s value, whereas rental income tax is based on the rental income you earn from a rented property.
However, one can claim their property rates as a tax deduction to reduce their rental income tax liability.
Further, rental income tax is collected by the Uganda Revenue Authority. The revenue from this tax contributes to funding the national budget.
Whereas property rates are a levy collected by local governments. The revenue from property rates contributes to spending on services at the local level.
Local services include things like city planning and management, road construction and maintenance, street lights, sanitation and garbage collection, antimalarial drugs and clean water.
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