A team of researchers presents on the role of technology in strengthening property taxation in Arusha, Kiambu, Kitwe, and Ndola.

1. The role of ICT in enhancing property tax
revenue in Africa: A tale of four cities
Riël Franzsen, African Tax Institute, University of Pretoria
William McCluskey, African Tax Institute, University of Pretoria
Mundia Kabinga, Development Finance Centre, University of Cape Town
Chabala Kasese, Zambia Revenue Authority
12 June 2018
APTI Conference on Stimulating and Promoting Effective
Property Tax Systems in Africa
Dakar, Senegal

2. 2
The team

3. 3
• Mostly paper-based manual systems
• Documents are prone to unlawful duplication
• Management and archiving of documents (e.g., risks of loss)
• Revenue lost due to leakages
• Receipt of cash payments (e.g., risks and admin./compliance costs)
• Incomplete and inaccurate registers and data bases
• Poor revenue budgeting and forecasting
• Misapplication of funds; irregular payments; unaccounted for
revenue; unspent funds; failure to collect revenue; absence of/
failure to follow procurement rules; etc.
Challenges faced by local councils in African cities

4. 4
Corruption
Manual processing Poor planning
frameworks
Outdated data & information Revenue collection
leakages
Current problems in revenue collection
Source: McCluskey, Huang, Doherty & Franzsen, 2017

5. DELIVERY STRATEGY
Revenue collection: Enhanced compliance
BILLING
Key to this approach is ensuring that taxpayers/traders understand their obligations
MAKE IT AS EASY AS POSSIBLE
FOR THOSE TRYING TO
COMPLY
MAKE IT AS HARD AS POSSIBLE FOR
THOSE TRYING TO EVADE OR AVOID
PAYING THEIR FAIR SHARE
IMPROVE SERVICE
ENHANCED COMPLIANCE
IMPROVE ENFORCEMENT
COLLECTION ENFORCEMENT
Source: McCluskey, Huang, Doherty & Franzsen, 2017

6. 6
An Information Communication and
Technology (ICT) System is –
a business process that assists in the
collection, storage, organization,
communication and use of data and
information
ICT can and should play an important
role in addressing the challenges faced
by local councils in Africa’s cities.

7. 7
Key statistics of the four cities
City Country Size
(km2
)
Est.
Population
Arusha Tanzania 267 420,000
Kiambu Kenya 2,449 1,625,000
Kitwe Zambia 808 690,000
Ndola Zambia 965 551,000
Sources: Various

8. Arusha City Council, Tanzania
Time management:
LGRCIS increases efficiency and time management when compared with the
previous manual system. Under LGRCIS, it is easy to make assessments and issue
bills on time. For example, mass bill generation and the generation of multiple
reports that can be used for making.
Accuracy:
LGRCIS assists the council to be more accurate in terms of billing information
therefore reducing errors. The LGRCIS reduces the possibility of revenue
collection staff to interfere with revenue receipt books through carbon slipping.
Reporting:
LGRCIS helps us to produce various reports on time. These reports are
automatically updated as compared to manual system.
Broader Tax Base:
Geographic Information System (GIS) helps to increase the number of taxpayers.
Data from GIS entered to LGRCIS helps us to have better records of all taxpayers
and hence increases the council’s own-source revenue.
Transparency:
LGRCIS increases transparency, due to the fact that taxpayers information are
easily accessible.

9. Arusha 102,904
Dodoma 59,420
Kigoma 42,535
Mbeya 100,298
Mtwara 16,869
Mwanza, 82,000
Tanga 47,439
Tanzania Strategic Cities Project
Total: 451,065 buildings
Colours represent density of buildings
9
Source: McCluskey, Huang, Doherty & Franzsen, 2017

10. 10
Objectives
•To collect and report revenue on a real time basis
•Geographically locate all taxpayers/properties
•Allow for multiple payment modes (e.g., mobile money, banks, etc.)
•Allow for integration with other systems (e.g., of commercial banks)
•Allow for intelligent reporting and analysis
•Produce secure receipts and licences that cannot be forged
•Allow citizens to transact easily with the council
Local Government Revenue Collection Information System
(LGRCIS)

11. • Satellite imagery is acquired and processed; roads and
buildings digitised
• Undertake systematic fieldwork to collect other
property-related details (e.g., occupier, use, age, etc.)
• Building a comprehensive database to support revenue
collection
Core data collection
11

12. Initial data from aerial or satellite images
12Source: McCluskey, Huang, Doherty & Franzsen, 2017

13. Property identification numbers (PINs) and physical addresses
Buildings and roads updated and captured into
a GIS database
Source: McCluskey, Huang, Doherty & Franzsen, 2017
New opportunities for linking taxpayers to properties,
reconciling income and ensuring security

14. 14
Arusha digitized 102,904 buildings
Source: McCluskey, Huang, Doherty & Franzsen, 2017

15. 15
Identification of buildings and taxpayers
- (ARU007001)
- USAGE
- BUILDING STATUS
- LOCATION/BLOCK
- OWNER
Source: McCluskey, Huang, Doherty & Franzsen, 2017

16. Property and building characteristic in-field data collection
Multiple attributes are collected,
including:
- Ownership
- Use (commercial/residential, etc.)
- Age
- Condition/quality
Source: McCluskey, Huang, Doherty & Franzsen, 2017

17. Property and building characteristic in-field data collection
• Hand-held PDA/GPS/CAM
devices
• Supported by 3-tier data
verification and collation
system
• Same system used/adapted
for in-field revenue collection,
reconciling payments and
receipts
Revenue collectors become more professional
and incentivised by productivity and honesty
and the absence of deceitful and corrupted
processes
Revenue collection is
leak-proof

18. 18
Core field data collection in detail
Every building will have:
- An ID
- Owner/occupier information
- Lots of physical attributes (age,
sanitation, water, condition, etc.)
- Units and use of each
- Photograph
Source: McCluskey, Huang, Doherty & Franzsen, 2017

19. Arusha City Council: Revenue Performance

20. 20
Arusha City Council: Revenue Performance

21. LGRCIS allows for integration
21
- Human resources information system
- Document and file management system
- Revenue collection system
Source: McCluskey, Huang, Doherty & Franzsen, 2017

22. Benefits of a fully-populated LGRCIS
22
• Robust decision making
• Professional approach to local revenue generation and collection – by
all role players
• Transparent billing and collection (i.e., a cashless society)
• Transparent and efficient taxpayer monitoring using GIS
• Reliable payment mechanisms (e.g., bank transfers, m-pesa, POS
machines, etc.)
• Dependable receipted transactions for all services
• Improved taxpayers trust and confidence
• Improved budgeting and revenue forecasting

23. 23
Challenge for LGRCIS: Sustainability
• Capacity development and training of staff
• Core data collection processes
• Continuing development of LGRCIS
• Coordinating role of President’s Office – Regional and Local
Government (PO-RALG)
• Reliability of the system
• Internet connectivity
• Integration of GIS
• Development of partnerships with banks and mobile money
operators
• Taxpayer education

24. Kiambu County Council, Kenya
Kiambu doubles revenue collection on automation
THURSDAY, JULY 7, 2016
“The county government has increased its annual
revenue collection by over 100 per cent in the last two
years, Governor William Kabogo has said.
According to the county boss, Kiambu’s revenue
collection stood at Sh1.1 billion as at May 2014, but this
has increased to Sh2.3 billion as at May this year, which
represents 109 per cent increase. Mr Kabogo attributed
the increase to automation of the county revenue
collection system, which he said had sealed all leakages.
However, the increase is way below the set annual
target of Sh3. 8 billion which the county hopes to collect
to supplement its Sh12.6 billion 2016/2017 budget, but
the governor is optimistic that their collection will keep
growing.”
Source: Business Daily 2016.

25. • Elimination of all forms of manual payment within all county departments
• Kiambu County has experienced an upsurge in revenue collection after implementing
CountyPro
• The adoption of the Integrated Financial Management Information System (IFMIS),
M-Pesa, Airtel Money, Visa and MasterCard payment modes and e-procurement
systems minimise corruption, tampering and fraud in procurement
• Adoption of the CountyPro system has enhanced integrity and accountability in
county clerks as it reduced personal interaction between tax officials and taxpayers
(hence reducing corruption)
• CountyPro also had societal impact through increased citizen participation and
access to information
• Lack of connectivity between all modules in the system that would ensure that all
revenue is collected through a single system
• Inadequate internet connection is the most common problems reported with the
new revenue system
Implementation of CountyPro

26. • It helped to reduce bureaucracy present in the previous manually based approaches
• Reduced the amount of paper work required
• Reporting functions were automated. The reports provided revenue and expenditure
analysis, useful for decision making by the policy makers
• The system was designed to be operational full-time with no down-time. Those citizens
living outside of the county could make payments for fees and licences online. Citizens can
log in and their pay the land rates (i.e., property tax), licenses or any other taxes via a range
of payment methods made possible by the system (e.g., m-pesa; POS machines; etc.)
• Efficient delivery of government services to citizens
• Reduced dependence on human interactions
• Reduced cost in terms of time and resources in processing transactions/applications and
delivering citizen services
• Increased citizen participation/empowerment through transparency, and access to
information
• Citizen participation in the county government increased as information was available via
text messages and via the internet
• It also alerts taxpayers to any outstanding arrears
• Increase in revenues
Benefits of CountyPro

27. Kiambu County: Revenue Performance

28. Kitwe City Council, Zambia

29. Ndola City Council, Zambia

30. Zambia: Kitwe vs Ndola City Council (2015)
Criteria Kitwe City Council (KCC) Ndola City Council (NCC)
Tax Burden Commercial (30.7%)
Residential (25.8%)
Mining (23.8%)
Industrial (16.5%)
Mining (36.5%)
Commercial (25%)
Residential (16.4%)
Industrial (13.4%)
Breakdown of Properties Residential (45,884)
Commercial (1,540)
Industrial (547)
Places of Worship (117)
Agricultural (320)
Government (87)
Mining (2)
Residential (40,905)
Commercial (1,195)
Industrial (508)
Exempted (55)
Government (73)
Mining (5)
Poundage (ZMK) Mining (0.016)
Commercial (0.006)
Industrial (0.006)
Residential (0.002)
Government (0.002)
Agricultural (0.002)
Mining (0.015)
Commercial (0.005)
Government (0.005)
Industrial (0.004)
Residential (0.002)

31. Zambia: Kitwe vs Ndola City Council (2015)
Criteria Kitwe City Council (KCC) Ndola City Council (NCC)
Actual Collections (2015) 22,012,690 (ZMK) 25,165,155 (ZMK)
2015 Property Tax
Contribution to OSR (%)
49.6 43
Population (2015) 646,827 530,129
Rates Per Capita (US$) 34 ZMK (3.10 USD) 47 ZMK (4.32 USD)
ICT Supplier, Maintenance,
and Updates
Locally Sourced Internationally Sourced
Number of ICT Systems One System
Relational Database
Three Systems
Internet-based
Expected Annual Tax Value 57,146,514 (ZMK) 40,122,128 (ZMK)

32. Kitwe City Council, Zambia

33. Kitwe City Council, Zambia

34. Organizational Structure & IT Infrastructure
•ICT organized as a support sub-department within Finance
=> Explains lack of IT departmental strategy
•KCC uses a Windows-based relational data base
programme called Palmsoft - maintained and upgraded by a
local company
•PalmSoft does not require the internet to function but, is
slow and not flexible when data input errors must be
rectified
Limited use of PalmSoft

35. Outcomes
•IT plays support role & lacks an IT departmental strategy
•Many revenue-related functions are still paper-based
•There are no direct electronic links between KCC and
commercial banks in Kitwe, and the council has not yet
negotiated these links with mobile telephone operators,
although there are initiatives to do so in future
Limited use of PalmSoft

36. Opportunities
•As property tax constitutes almost 60 per cent of KCC’s
own-source revenue (KCC, 2018), it is critically important to
restructure IT into a department in addition to developing
and implementing an ICT strategy
•It is necessary to review the overall functionality of
PalmSoft and generate timely audited financial reports
Limited use of PalmSoft

37. Ndola City Council, Zambia

38. Ndola City Council, Zambia

39. Organizational Structure & IT Infrastructure
•ICT is not fully embraced by NCC and IT organized as a
support sub-department within Finance which, explains lack
of ICT strategy
•Internet-Based Software and 3 Fragmented ICT Systems
o GIS Mapping (early stages)
o Client Database Management, Billing, and Collections
o Payroll Management
Limited use of ICT

40. Bottlenecks
•NCC procured system from India in 2016 to manage land,
billing and receipts, but this system has not yet been fully
automated and integrated as only subscribed to 3 of 50
relevant user licences
•NCC lacks access to adequate training and technical support
from foreign-based consultants – a huge problem
•Officials have no access to the internet so cannot access
Google Maps nor integrate web-based land management,
billing and receipt systems
Limited use of ICT

41. Outcomes
•NCC plays support role and lacks IT departmental strategy
•City valuers still use old, worn maps when preparing
valuation rolls, and main valuation roll with about 42,000
properties, is Excel-based
•All tax bill verifications and payments are made at the NCC
civic centre, none are directly deposited into the NCC’s bank
account
•Cash payments are received and reported on a daily basis
Limited use of ICT

42. Opportunities
•Opportunity and urgent need for local procurement of IT
systems, and IT applications for bill verification and payment
Limited use of ICT

43. Overall conclusions
• Property tax is a “data hungry” tax, therefore increased automation
should be a priority
• Evidence from Arusha and Kiambu suggests that taxpayer trust and
voluntary compliance increased with automation (especially with
the issuance of computer-generated receipts)
• In-house developed or commercial off-the-shelf (COTS) ICT systems
that are not integrated with central government systems is a
common problem

44. Overall conclusions
• For LGAs to efficiently manage their property tax assessment and
collection, as well as other own source revenues, a uniform system
such as Tanzania’s LGRCIS shows promise
• Standardized reporting and compatibility with Treasury is a problem
in Kenya as a result of fragmentation of IT systems used by county
governments
• A national, uniform system has many benefits (e.g., cost
effectiveness in technical support; consistency and standardization
of training and capacity building; LGA staff are civil servants so
moving staff from one council to another would not necessitate
system retraining – a serious issue in Zambia)

45. Questions and Discussion
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