## 1. Composition of General Government Property Taxes, Selected OECD Countries 2011......7

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### Introduction: role and renewed interest in property taxation
- Property taxes are viewed as an efficient and equitable revenue source but largely untapped in many countries.
- Typical characteristics and motives:
  - Yield relatively modest revenue, especially in developing and emerging economies.
  - Political resistance tied to transparency and limited avoidance/evasion opportunities.
  - Strengthening immobile tax sources (immovable property taxes) can offset revenue losses from taxation of highly mobile bases.
  - Renewed global interest reflected in reform initiatives with motives varying by country group (devolution/local democracy in transition economies; revenue mobilization/land-use incentives in developing countries).
- Structure of the paper (as described): Chapter II discusses nature and yield of property taxes; Chapter III economic rationale; Chapter IV obstacles; Chapter V action-plan contours; Chapter VI concludes.

### Recent property tax reforms and plans (selected examples — Box 1)
- Selected reform actions noted:
  - Namibia: central government land tax on agricultural land with a basic rate of 0.75 percent.
  - Liberia: reformed real property tax rate structure from 2011.
  - Cambodia: new property tax in 2011 based on assessed market values; piloted in limited urban areas.
  - China: decided to introduce residential property taxation starting in 2011; pilots in Shanghai and Chongqing.
  - Hong Kong SAR: buyer’s stamp duty at 15 percent for non-local and corporate buyers (early 2013).
  - Singapore: increased stamp duties on certain home buyers.
  - Vietnam: June 2010 new area-based tax on non-agricultural land (excluding housing).
  - Croatia: introducing ad valorem property tax at a uniform tax rate of 1.5 percent.
  - Greece: late 2011 new square-meter tax collected over electricity bills.
  - Ireland: abolished residential property tax in 1997; new market-value-based property tax expected mid-2013 to replace €100 annual household charge introduced January 1, 2012.
  - Latvia: introduced residential property tax on buildings in 2010.
  - Serbia, Slovenia, Egypt, Kyrgyzstan and several Caribbean and Central American countries noted as planning or enacting reforms.

### Property taxation — concepts and composition
- Definition and focus:
  - Property taxes include: recurrent taxes on immovable property (gross of debt), recurrent taxes on net (of debt) wealth, estate/inheritance/gift taxes, financial/capital transaction taxes on transfers, and other recurrent/non-recurrent property taxes.
  - Paper focuses primarily on recurrent taxes on immovable property while presenting broader information.
- Cross-country differences:
  - Some countries rely mainly on immovable property taxes: New Zealand, Poland, United States, United Kingdom, Japan, Canada.
  - Others rely substantially on inheritance/capital transfer taxes or net wealth taxes: Germany, Greece, Italy, Korea, Netherlands, Luxembourg, Switzerland, Norway.
  - In several developing and transition countries the recurrent immovable property tax is the only property tax source (Azerbaijan, Jordan, Georgia, Mongolia, Ukraine).

### Composition of general government property taxes — exact figures (Total = 100)
- Source: OECD Revenue Statistics, 2012. (Poland and Greece data are 2010.)
- Country-by-country exact shares and totals (selected entries preserved exactly):
  - New Zealand
    - Recurrent taxes on immovable property: 95.5
    - Recurrent taxes on net wealth: 0.0
    - Estate inheritance and gift taxes: 0.0
    - Taxes on financial and capital transactions: 0.0
    - Other: 4.5
    - Total: 100.0
    - Total, percent of GDP: 2.2
  - Poland (2010)
    - Recurrent taxes on immovable property: 100.0
    - Recurrent taxes on net wealth: 0.0
    - Estate inheritance and gift taxes: 0.0
    - Taxes on financial and capital transactions: 0.0
    - Other: 0.0
    - Total: 100.0
    - Total, percent of GDP: 1.2
  - United States
    - Recurrent taxes on immovable property: 96.8
    - Recurrent taxes on net wealth: 0.0
    - Estate inheritance and gift taxes: 3.2
    - Taxes on financial and capital transactions: 0.0
    - Other: 0.0
    - Total: 100.0
    - Total, percent of GDP: 3.1
  - Germany
    - Recurrent taxes on immovable property: 55.6
    - Recurrent taxes on net wealth: 0.0
    - Estate inheritance and gift taxes: 22.2
    - Taxes on financial and capital transactions: 22.2
    - Other: 0.0
    - Total: 100.0
    - Total, percent of GDP: 0.9
  - Greece (2010)
    - Recurrent taxes on immovable property: 10.0
    - Recurrent taxes on net wealth: 20.0
    - Estate inheritance and gift taxes: 10.0
    - Taxes on financial and capital transactions: 50.0
    - Other: 10.0
    - Total: 100.0
    - Total, percent of GDP: 1.0
  - Luxembourg
    - Recurrent taxes on immovable property: 3.8
    - Recurrent taxes on net wealth: 76.9
    - Estate inheritance and gift taxes: 3.8
    - Taxes on financial and capital transactions: 15.4
    - Other: 0.0
    - Total: 100.0
    - Total, percent of GDP: 2.6

### Levels and trends in property tax revenues — key quantitative findings
- Data coverage: generally 1990–2010; 2010 data reproduced in Appendix Tables 1–4.
- Aggregate time-series (by decade, Percent of GDP) — exact values preserved:
  - OECD countries (number of countries)
    - 1970s: 1.24 (16)
    - 1980s: 1.31 (18)
    - 1990s: 1.44 (16)
    - 2000s: 2.12 (18)
  - Developing countries (number of countries)
    - 1970s: 0.42 (20)
    - 1980s: 0.36 (27)
    - 1990s: 0.42 (23)
    - 2000s: 0.60 (29)
  - Transition countries (number of countries)
    - 1970s: 0.34 (1)
    - 1980s: 0.59 (4)
    - 1990s: 0.54 (20)
    - 2000s: 0.68 (18)
  - All countries (number of countries)
    - 1970s: 0.77 (37)
    - 1980s: 0.73 (49)
    - 1990s: 0.75 (59)
    - 2000s: 1.04 (65)
- OECD time-series (1965–2010) summary:
  - Average revenue ratio for total property taxes broadly stable around 2 percent of GDP since 1965.
  - Recurrent taxes on immovable property constitute roughly half of total property taxes, with a broadly stable revenue ratio at around 1 percent of GDP.
  - Yields of property taxes as share of total general government tax revenue declined in late 1960s–1970s and stabilized thereafter.

### Cross-country variation by income level (immovable property taxes, percent of GDP)
- Exact average yields:
  - High-income countries: 1.06 percent of GDP (average yield from immovable property taxes).
  - Middle-income countries: 0.40 percent of GDP.
    - Lower-middle income: 0.33 percent of GDP.
    - Upper-middle income: 0.44 percent of GDP.
- Notable dispersion:
  - Some high-income countries collect close to nil (Croatia, Luxembourg, Switzerland).
  - Others collect more than two percent of GDP (Canada, France, Israel, Japan, New Zealand, United Kingdom, United States).
  - Many middle-income countries rely modestly (examples: Dominican Republic, Mexico, Peru, Tunisia, Albania, Egypt, Moldova, Mongolia).

### Distribution and yield statistics (Appendix Tables 3 and 4 highlights)
- Yield of immovable property taxes on average:
  - 4½ percent of total taxes in high income countries
  - 2.1percent in middle-income countries
- R² = 0.0995
- Country-level reliance noted:
  - Bulgaria, Russia, and Georgia rely close to or above one percent of GDP on immovable property taxes
- Figure note: Figure 4 (2009) shows markedly greater dispersion among high income countries than among middle income countries.

### Role for local governments and assignment
- Immoveable property taxes are predominantly assigned to lower levels of government.
- Appendix Tables 3 and 4 (penultimate column): share of immovable property tax in total local taxes is 100 percent in Australia, Ireland, and the United Kingdom.
- Average share in total local taxes:
  - 37.7 percent in high income countries
  - 35.5 percent in middle income countries
- In the large majority of both high income and middle income countries, all immovable property tax revenue collected by government accrues solely to local governments.
- Policy implication: increased reliance on immovable property taxes involves important issues of inter-governmental fiscal design and local autonomy.

### Potential revenue from immovable property taxes
- Benchmark approach (five best performers in each income group) yields exact potential collections:
  - High income countries: about 2.9 percent of GDP (based on the five best performers).
  - Middle income countries: about 0.9 percent of GDP (based on the five best performers).
- Aggregate potential increases when applying benchmarks:
  - Among 29 high income countries: potential average revenue increase of 2.1 percent of GDP.
  - Among 24 middle income countries: potential average revenue increase of 0.6 percent of GDP.
- Caveat: net gains may be tempered by the need to scale back distortive property transfer taxes.

### Key determinants of recurrent property tax levels (Box 2 summary)
- Data: panel for 64 countries, generally 1990–2010; two regression models applied.
- Between Effects Model (cross-sectional):
  - Functional form: ln(R) = .54 ln(GDP PC) + .65 ln(P) + .68 ln(O) + 1.3 AS − 16.3 + ε
  - Variables significant with p-value below 0.05: GDP per capita (GDP PC), population in urban conglomerations over 1 million (P), openness (O), Anglo-Saxon legal heritage dummy (AS).
- Fixed Effects Model (over-time within countries):
  - Functional form: ln(R_it) = .29 ln(GDP PC_it) + 1.7 ln(P_it) − 4.6 + α_i + ε_it
  - Openness not statistically significant in fixed effects model.
- Non-linear development effect model:
  - R_it = 1.34 ln(GDP PC_it) − 1.09 [ln(GDP PC_it)]^2 + 2.3 ln(P_it) + α_i + ε_it
  - Coefficient of GDP per capita squared statistically significant with p-value 0.02.
- Overall conclusions:
  - Economic development and urbanization explain important variations in property tax revenue per capita.
  - Degree of openness and legal origin may be additional factors.
  - Data limitations prevented analysis of corruption impact.

### Efficiency considerations in favor of property taxation
- Efficiency rationale:
  - Recurrent property taxes on land and buildings are relatively efficient because land is truly immobile.
  - Property taxes generally do not affect labor supply, investment, or innovation to the same extent as income or corporate taxes.
  - If fully capitalized in prices, property tax changes are neutral to investment behavior.
- Tax-and-growth ranking evidence:
  - OECD (2008 and 2010) ranks recurrent immovable property taxes (residential in particular) as least distortive for long-run GDP per capita.
  - Ranking (least to most harmful): recurrent immovable property taxes → consumption taxes → personal income taxes → corporate income taxes.
- Local tax advantages:
  - Ideal local tax: borne mainly by residents, limited spillovers, values reflect local services, stable and predictable revenue.
- Business property and exemptions: reliefs often applied (e.g., agricultural exemptions).
- Intergovernmental fiscal effects:
  - Strengthening property taxation can reduce local dependence on transfers and enhance local accountability.
- Land-use efficiency:
  - Site (land) value tax maximizes incentives for optimal land use.
- Interaction with other taxes:
  - Higher property taxes can reduce bias favoring owner-occupied housing and reduce reliance on transfer taxes.
- House price volatility and limits:
  - Property taxes have at best a one-off effect on price levels if capitalized; non-tax macroprudential tools may be more effective for volatility.
- Resilience in small open economies:
  - Property taxation can increase resilience to external shocks by relying on immobile bases.

### Equity considerations and incidence (Box 3 summary)
- Incidence perspectives:
  - Traditional (“old”) view: tax on mobile capital shifted to renters/consumers/labor; tax on land borne by landowners; tends to find regressive incidence.
  - New view (Mieszkowski, 1972): capital in fixed supply but mobile; property tax tends to be progressive because land and capital owned by higher-income individuals.
  - Benefit view: treats property tax as payment for local public services; property values capitalize benefits.
- Relevance in developing/transition countries:
  - New view assumptions (full capital mobility, fixed land supply) often not met.
  - CGE model simulations (Sennoga, Sjoquist, and Wallace, 2008) tailored to developing conditions found property tax burden borne by owners of capital and land and progressive (burden on middle-and high-income earners).
- Denmark example:
  - Under the “new” view, property tax appears regressive in first two deciles and progressive thereafter; heterogeneity (e.g., pensioners with valuable property) complicates interpretation.
- Valuation approaches and equity:
  - Market values argued to maximize fairness; area-based taxes can create unfair effective rate variations.

### Cyclical resilience of property tax revenues
- OECD observation around 2008–10: flat revenue ratio during boom years leading into recession, suggesting low cyclical sensitivity.
- United States evidence:
  - State and local tax revenues fell almost 5.5 percent in 2009 (driven by personal income tax −17 percent and sales tax −7.5percent).
  - Property tax revenues grew more than 5 percent in both 2008 and 2009, buffering declines in other sources; growth stopped in subsequent years.
- Drivers of resilience:
  - Estimated elasticity of property tax revenue with respect to home prices = 0.4.
  - Policymakers offset as much as 60 percent of house price changes by adjusting effective tax rates oppositely.
  - House price changes affect property taxes after about three years due to backward-looking assessments, lagged assessed values, and caps/limits.

### Policy design and implementation: determinants of revenue yield (basic revenue equation)
- Revenue equation: R = B × t × C × V × E, where:
  - R: collected revenue
  - B: legally defined tax base at actual prices
  - t: average tax rate
  - C: ratio of properties covered in the tax roll relative to all legally defined properties
  - V: ratio of assessed to actual value of property in the roll
  - E: enforcement level measured as actual collections as a share of liabilities/invoices
- Policy and administrative levers affecting B, t, C, V, E:
  - Base definition and measurement (market price methods, rental values, area-based methods).
  - Property components (land only, buildings only, or combinations).
  - Treatment by use (residential vs. business, urban vs. agricultural).
  - Specific base choice depends on objectives and market/administrative capacity.
- Relevance for urbanization:
  - UN projections: Africa’s urban population will more than double between 2000 and 2030.
  - Global forecast: world’s urban population will double from 3 billion in 2000 to 6 billion in 2050.
  - Proposed strategy: capital value systems for urban areas and area-base systems for rural areas.

### Property valuation systems (Box 4 summary)
- Valuation methods and characteristics:
  - Rental value systems: used in India, Nigeria, Malaysia, Trinidad; challenges include scarce rental data and rent control; reflects present use not best alternative use.
  - Capital value systems: market value of property; used in most OECD and Latin American countries; advantages include capturing vacant land value; problems include scarce transaction data and high administrative costs.
  - Land (site) value systems: tax land market value alone; used in Australia, New Zealand, Denmark, Estonia, Jamaica, Kenya; strong land-use incentives but smaller base.
  - Area-based systems: specific rate per area unit; used in Central and Eastern Europe and many developing countries (Vietnam, Nigeria); simple and easy to administer but may be unfair and non-buoyant.
- Regional use (Table 4 totals and regional breakdown — exact numbers preserved):
  - Number of Countries: 121
  - Land Value: 16
  - Capital Improved Value: 52
  - Land and Improvements: 8
  - Improvement Only: 4
  - Annual Rental Value: 37
  - Area: 42
  - Flat Rate: 6
  - Regional counts given for Africa (25), Caribbean (13), Asia (24), Oceania (7), Western Europe (13), Eastern Europe (20), Central and South America (16), North America (3) with breakdowns as presented in source.
- Exemptions and base erosion:
  - Common exemptions: government property, schools, religious establishments, owner-occupied housing, business incentives.
  - Examples:
    - Owner-occupied housing inclusion could triple provincial property tax revenues in Punjab province, Pakistan (Bahl (2009) reference in source).
    - Exempting government property estimated to cost about 12 percent of collections in India’s 36 largest cities.
    - Serbia: owner-occupiers receive a 40 percent reduction, increased by 10 percent per household member up to 70 percent ceiling.
    - Uganda: multiple social and institutional exemptions listed.
    - Agriculture often receives favorable treatment (Nicaragua, Guinea, Tunisia).
  - Bottom line: exemptions and reliefs can substantially erode bases.

### Tax rate structures and examples
- Rate approaches:
  - Capital value base: flat or progressive rate; progressivity via basic property deduction.
  - Rental value base: flat rate typically applied.
  - Area-based tax: flat rate per unit area.
- Country examples:
  - Namibia: central government tax on agricultural land basic rate 0.75 percent; Windhoek urban rates: 0.0734 percent of site value and 0.0379 percent of house value.
  - Serbia: progressive local rates from 0.4 percent up to 3 percent.
  - Cambodia: considering a uniform 0.1 percent tax.
  - Kyrgyzstan: dual rates 0.35 and 1.0 percent.
  - Uganda: legal maximum of 2 percent of rateable value.
- Policy note: simple, transparent, fairly uniform rates minimize administrative complexity; use thresholds rather than across-the-board low rates to protect the poor.

### Coverage, valuation, and enforcement challenges (administrative factors C, V, E)
- Coverage (C) examples:
  - Kenyan municipalities: coverage 30–70 percent.
  - Chile: large share of new construction not included.
  - Serbia: previously 40–50 percent of real estate not in register; improved after 2007 devolution.
  - Latvia: more than 98 percent included (may reflect privatization process).
- Valuation (V) challenges:
  - Lack of valuators, weak administration, thin markets.
  - Assessment ratios reported: 25 to 50 percent in selected Indian cities (rental); 10 to 90 percent in selected Latin American cities (market value).
  - Serbia: book values often well below market values; one municipality: 83 percent of properties book value < 50 percent of market; 31 percent < 10 percent of market.
  - Importance of regular updates; Germany example of dated assessments.
- Transfer taxes interaction:
  - High transaction taxes (e.g., 15 percent in Senegal and Jamaica) incentivize undervaluation.
  - Examples: Namibia transfer duties 8 percent (individuals) and 12 percent (companies); UK stamp duty maximum rate 7 percent.
  - Policy option: reduce transaction taxes or replace with capital gains taxes.
- Enforcement (E) examples:
  - Collection ratios: Philippines 50 percent; Kenya 60 percent; Croatia 70 percent; Macedonia 15 percent; Latin America often 75 percent or above.
  - Causes: local political incentives, low penalties, large central transfers.
  - Remedies: bank collection points; reward improved enforcement with higher transfers; link payments to utility services.
- Administrative cost and cost-to-revenue ratio:
  - Weak C and V can reinforce each other and raise cost-to-revenue ratios.
  - If C and V ≈ 0.7, total yield could potentially double through widening coverage and updating values.
  - Upfront investments needed: registration, cadastre, IT, training.
  - Latvia: municipal administrative costs exceed 10 percent of revenues in about half of local governments and up to 36 percent in some; influenced by low tax rates.

### Policy implications and recommendations (synthesized from Box 4 and text)
- Strengthen coverage: include nearly all land and improvements in tax registers and update regularly.
- Improve valuation capacity: invest in valuators, valuation systems, and regular updates; calibrate central-local valuation responsibilities to local capacity.
- Address transfer taxes: consider reducing transaction taxes or replacing with capital gains taxes to improve market transparency.
- Rationalize exemptions and reliefs: scale back excessive exemptions (including owner-occupied housing exemptions); use basic thresholds to protect the poor.
- Simplify rate structures: adopt simple, uniform rates and thresholds rather than across-the-board low rates.
- Strengthen enforcement: improve collection mechanisms, penalties, and incentives for local authorities.
- Invest in administrative infrastructure: cadastre, IT systems, registration procedures, and training.
- Consider payment-in-lieu arrangements where charging government or non-profit property directly is infeasible.

### Case study — Bogota City self-assessment approach (Box 5)
- Background and reform design:
  - Prior to 1993 less than 50 percent of property owners included in cadastral base; cadastral values ~20–30 percent of market values.
  - 1993 reform introduced self-assessment requiring taxpayers to declare properties and values.
  - Declared land values could not be less than the highest of: (1) 50 percent of commercial value; (2) cadastral valuation; (3) previous year’s self-assessment indexed with inflation. The 50 percent provision repealed in 1994.
  - Self-assessed values used to calculate capital gains under income tax for a minority of owners.
- Outcomes and impacts:
  - Inclusion of many informal properties; tax filings doubled in one year.
  - Taxable values moved closer to market values; property tax revenues in real terms grew by 77 percent in 1994.
  - Sustained increase in number of properties declaring tax through the following decade.
- Subsequent developments:
  - Late 1990s recession reduced market values; minimum legal self-assessed values sometimes above market.
  - 2000 national legislation eliminated self-assessment and introduced IVIUR index to update cadastral values.
  - Declared cadastral value filings rose from 72 percent in 2000 to 85 percent in 2002.
  - By 2004 cadastral valuation/commercial value ratio ≈ 81 per cent.
- Lessons:
  - Self-assessment can rapidly expand coverage and values but may distort under market changes.
  - Autonomous cadastral capacity and complementary tools (legal limits, indices, updating programs) are necessary.
  - Declared values used for related taxes can strengthen compliance.
  - Reforms can produce substantial short-term revenue gains but require mechanisms to adjust to market fluctuations.

### Appendix tables and country-level highlights (selected exact entries)
- Appendix Table 1 (OECD countries, 2010) — selected exact values:
  - United Kingdom (2010): % of GDP = 4.23; % of Total General Taxes = 14.92; Local % of GDP = 3.42; Local % of Total General Taxes = 12.06; % of General Property Tax = 100.00; % of Total Local Taxes = 51.81.
  - France (2010): % of GDP = 3.65; % of Total General Taxes = 13.89; Local % of GDP = 2.46; Local % of Total General Taxes = 9.37; % of General Property Tax = 100.00; % of Total Local Taxes = 53.44.
  - Canada (2010): % of GDP = 3.49; % of Total General Taxes = 13.32; Local % of GDP = 3.04; Local % of Total General Taxes = 11.61; % of General Property Tax = 91.05; % of Total Local Taxes = 91.98.
  - United States (2010): % of GDP = 3.21; % of Total General Taxes = 17.49; Local % of GDP = 3.07; Local % of Total General Taxes = 16.76; % of General Property Tax = 73.03; % of Total Local Taxes = 96.68.
- Appendix Table 3 (High-Income countries) — aggregate average exact figures:
  - Average: High Income — GDP/Capita (US$): 38011.26
    - General Government: % of GDP: 1.78; % of Total General Taxes: 7.36
    - Local Government: % of GDP: 1.06; % of Total General Taxes: 4.46
    - % of Total Local Taxes: 37.65; % of General Property Tax: 91.68
- Appendix Table 4 (Middle Income averages and selected country entries) — exact figures:
  - Average: Middle Income
    - GDP/Capita (US$): 5367.11
    - General Government % of GDP: 0.76
    - General Government % of Total General Taxes: 4.00
    - Local Government % of GDP: 0.40
    - Local Government % of Total General Taxes: 2.12
    - % of Total Local Taxes: 35.48
    - % of General Property Tax: 89.87
  - Argentina (2009): General Government % of GDP: 2.90; Local Government % of GDP: 0.36; % of Total Local Taxes: 100.00; % of General Property Tax: 100.00.
  - China, P.R.: Mainland (2009): General Government % of GDP: 1.73; Local Government % of GDP: 0.51; % of Total Local Taxes: 6.05; % of General Property Tax: 100.00.
  - Russian Federation (2010): General Government % of GDP: 1.22; Local Government % of GDP: 1.23; % of Total Local Taxes: 16.76; % of General Property Tax: 23.41.
  - Mongolia (2010): General Government % of GDP: 0.16; Local Government % of GDP: 0.16; % of Total Local Taxes: 6.77; % of General Property Tax: 100.00.

*IMF Working Paper — content unit "_wp13129 - 1. Composition of General Government Property Taxes, Selected OECD Countries 2011......7" (extracted from the provided PDF).*

### 1. Composition of General Government Property Taxes, Selected OECD Countries 2011......7

### 1. Composition of General Government Property Taxes, Selected OECD Countries 2011......7

### Introduction: role and renewed interest in property taxation
- Property taxes are widely regarded as an efficient and equitable means of raising revenue, but with a revenue potential that is largely untapped in many countries.
- Property taxes generally yield relatively modest revenue, particularly in developing and emerging economies, with large cross-country disparities reflecting popular opposition and administrative constraints—but also potential for enhanced utilization.
- Economists favor increased reliance on property taxes due to attractive economic properties; political resistance stems partly from the tax’s transparency and limited scope for avoidance and evasion.
- Strengthening immobile tax sources such as immovable property taxes is an alternative policy route to offset revenue losses from taxation of highly mobile tax bases (e.g., income taxed across borders).
- Renewed global interest is manifested in numerous reform initiatives and a rich recent literature, with motives varying by country group (e.g., devolution and local democracy in transition economies; revenue mobilization and land-use incentives in developing countries).
- Structure of the paper (as described): Chapter II discusses nature and yield of property taxes; Chapter III economic rationale; Chapter IV obstacles; Chapter V action-plan contours; Chapter VI concludes.

### Box 1 — Recent Property Tax Reforms and Plans (selected examples)
- Namibia: introduced central government land tax on agricultural land with a basic rate of 0.75 percent; aim to encourage efficient agricultural land use.
- Liberia: reformed real property tax rate structure with effect from 2011; contemplating further measures to strengthen property rights and revenue potential.
- Cambodia: introduced new property tax in 2011 based on assessed market values of land and buildings; piloted in limited urban areas.
- China: decided to introduce residential property taxation starting in 2011; pilot projects in Shanghai and Chongqing.
- Hong Kong SAR: introduced in early 2013 a buyer’s stamp duty at 15 percent of the transaction price for non-local and corporate buyers.
- Singapore: increased stamp duties on certain home buyers to curb property price increases.
- Vietnam: adopted in June 2010 a new area-based tax on non-agricultural land (excluding housing) and is considering further reform.
- Croatia: introducing new ad valorem property tax at a uniform tax rate of 1.5 percent to replace existing ‘utility fees’ and second home tax.
- Greece: adopted in late 2011 a new square-meter tax at varying specific rates, collected over electricity bills.
- Ireland: abolished residential property tax in 1997; a new market-value-based property tax expected mid-2013 to replace €100 annual household charge introduced January 1, 2012.
- Latvia: introduced residential property tax on buildings in 2010 to complement existing land tax.
- Serbia: plans in-depth modernization of property tax system to replace taxes based on property rights alongside land privatization reform.
- Slovenia: replacing three pre-existing duties with one uniform real property tax based on mass appraisal and a new real estate register.
- Egypt: adopted new real estate law with a rate of 10 percent applied to estimated rental income, effective 2009 with delayed application until 2012.
- Kyrgyzstan: introduced new property tax for companies and individuals effective January 1, 2009, on top of existing land tax.
- Several Caribbean countries: contemplating introduction or strengthening of property taxes due to exposure to regional tax competition.
- El Salvador: at present without an immovable property tax, considering introduction.

### Property taxation—concepts and composition
- "Property taxes" encompass a variety of levies on the use, ownership, and transfer of property: recurrent taxes on immovable property (gross of debt), recurrent taxes on net (of debt) wealth, taxes on estates/inheritances/gifts, financial and capital transaction taxes on transfers, and other recurrent/non-recurrent property taxes.
- The paper focuses primarily on recurrent taxes on immovable property while presenting information on the broader concept.
- Countries differ substantially in the relative use of property tax sources depending on policy objectives (stable sub-national revenue vs. capital transfer taxes vs. progressivity via net wealth/inheritance taxes).
- Some countries levy property taxes mainly on immovable property (examples include New Zealand, Poland, United States, United Kingdom, Japan, Canada); others rely substantially on inheritance/capital transfer taxes or net wealth taxes (examples include Germany, Greece, Italy, Korea, Netherlands, Luxembourg, Switzerland, Norway).
- In several developing and transition countries the recurrent immovable property tax is the only property tax source (examples: Azerbaijan, Jordan, Georgia, Mongolia, Ukraine).

### Composition of general government property taxes — exact figures (Total = 100)
- Source: OECD Revenue Statistics, 2012. (Note: Poland and Greece data are 2010.)
- New Zealand
  - Recurrent taxes on immovable property: 95.5
  - Recurrent taxes on net wealth: 0.0
  - Estate inheritance and gift taxes: 0.0
  - Taxes on financial and capital transactions: 0.0
  - Other: 4.5
  - Total: 100.0
  - Total, percent of GDP: 2.2
- Poland (2010)
  - Recurrent taxes on immovable property: 100.0
  - Recurrent taxes on net wealth: 0.0
  - Estate inheritance and gift taxes: 0.0
  - Taxes on financial and capital transactions: 0.0
  - Other: 0.0
  - Total: 100.0
  - Total, percent of GDP: 1.2
- United States
  - Recurrent taxes on immovable property: 96.8
  - Recurrent taxes on net wealth: 0.0
  - Estate inheritance and gift taxes: 3.2
  - Taxes on financial and capital transactions: 0.0
  - Other: 0.0
  - Total: 100.0
  - Total, percent of GDP: 3.1
- Germany
  - Recurrent taxes on immovable property: 55.6
  - Recurrent taxes on net wealth: 0.0
  - Estate inheritance and gift taxes: 22.2
  - Taxes on financial and capital transactions: 22.2
  - Other: 0.0
  - Total: 100.0
  - Total, percent of GDP: 0.9
- Greece (2010)
  - Recurrent taxes on immovable property: 10.0
  - Recurrent taxes on net wealth: 20.0
  - Estate inheritance and gift taxes: 10.0
  - Taxes on financial and capital transactions: 50.0
  - Other: 10.0
  - Total: 100.0
  - Total, percent of GDP: 1.0
- Luxembourg
  - Recurrent taxes on immovable property: 3.8
  - Recurrent taxes on net wealth: 76.9
  - Estate inheritance and gift taxes: 3.8
  - Taxes on financial and capital transactions: 15.4
  - Other: 0.0
  - Total: 100.0
  - Total, percent of GDP: 2.6

### Levels and trends in property tax revenues — key quantitative findings
- Data coverage: dataset generally covers the period 1990–2010; 2010 data reproduced in Appendix Tables 1–4.
- Available aggregate evidence:
  - Average revenue raising from property taxes is modest across OECD, developing, and transition countries, with a slightly upward trend since the 1970s (Bahl and Martinez-Vazquez, 2008).
  - Reliance on property taxation is strongly related to economic development; average revenue ratio to GDP in OECD countries is roughly triple that of developing countries (when considering total property tax revenue).
- Table 2. Levels of and Trends in Property Tax Revenues (Percent of GDP) — exact values by decade and country grouping
  - OECD countries (number of countries)
    - 1970s: 1.24 (16)
    - 1980s: 1.31 (18)
    - 1990s: 1.44 (16)
    - 2000s: 2.12 (18)
  - Developing countries (number of countries)
    - 1970s: 0.42 (20)
    - 1980s: 0.36 (27)
    - 1990s: 0.42 (23)
    - 2000s: 0.60 (29)
  - Transition countries (number of countries)
    - 1970s: 0.34 (1)
    - 1980s: 0.59 (4)
    - 1990s: 0.54 (20)
    - 2000s: 0.68 (18)
  - All countries (number of countries)
    - 1970s: 0.77 (37)
    - 1980s: 0.73 (49)
    - 1990s: 0.75 (59)
    - 2000s: 1.04 (65)
- OECD time-series (1965–2010) findings summarized
  - Average revenue ratio for total property taxes has been broadly stable around 2 percent of GDP since 1965, with a slight dip during the 1970s and recovery thereafter.
  - Recurrent taxes on immovable property constitute roughly half of total property taxes, with a broadly stable revenue ratio at around 1 percent of GDP during this period.
  - When measured as a share of total general government tax revenue, yields of property taxes in OECD countries declined during the late 1960s and 1970s and stabilized thereafter—mainly reflecting trends in immovable property taxes—due to buoyant income and consumption taxes and social security contributions.
- Cross-country variation by income level (immovable property taxes, percent of GDP)
  - Average yield from immovable property taxes in high-income countries: 1.06 percent of GDP.
  - Average yield in middle income countries: 0.40 percent of GDP.
    - Lower-middle income: 0.33 percent of GDP.
    - Upper-middle income: 0.44 percent of GDP.
  - Cross-country variation increases sharply with income level: some high-income countries collect close to nil (e.g., Croatia, Luxembourg, Switzerland), while others collect more than two percent of GDP from immovable property taxes (e.g., Canada, France, Israel, Japan, New Zealand, United Kingdom, United States).
  - Many middle-income countries rely modestly on immovable property taxes (examples: Dominican Republic, Mexico, Peru, Tunisia, Albania, Egypt, Moldova, Mongolia).

*Italic source attribution: IMF Working Paper — content unit "_wp13129 - 1. Composition of General Government Property Taxes, Selected OECD Countries 2011......7" (extracted from the provided PDF).*

### Appendix Tables 3 and 4 also show that the yield of immovable property taxes on average represents about

### _wp13129 - Appendix Tables 3 and 4 also show that the yield of immovable property taxes on average represents about

### Distribution and yield statistics
- Yield of immovable property taxes on average:
  - 4½ percent of total taxes in high income countries
  - 2.1percent in middle-income countries
- R² = 0.0995
- Notable country-level reliance:
  - Bulgaria, Russia, and Georgia rely close to or above one percent of GDP on immovable property taxes
- Figure note:
  - Figure 4 illustrates the distribution of yields from immovable property taxes, 2009, showing markedly greater dispersion among high income countries than among middle income countries

### Role for local governments and assignment
- Property taxes frequently contribute significantly to financing local governments
- Assignment:
  - Immoveable property taxes are predominantly assigned to lower levels of government
  - Appendix Tables 3 and 4 (penultimate column): share of immovable property tax in total local taxes is 100 percent in Australia, Ireland, and the United Kingdom
  - Average share in total local taxes:
    - 37.7 percent in high income countries
    - 35.5 percent in middle income countries
  - Last column of the two tables: in the large majority of both high income and middle income countries, all immovable property tax revenue collected by government accrues solely to local governments
- Policy implication:
  - Increased reliance on immovable property taxes involves important issues of inter-governmental fiscal design and local autonomy

### Potential revenue from immovable property taxes
- Benchmark approach (average revenue ratios of five best performers in each income group) yields:
  - High income countries: potential collection of about 2.9 percent of GDP (based on the five best performers)
  - Middle income countries: potential collection of about 0.9 percent of GDP (based on the five best performers)
- Aggregate potential increases (applying benchmarks to other countries in each group):
  - Among 29 high income countries: potential average revenue increase of 2.1 percent of GDP
  - Among 24 middle income countries: potential average revenue increase of 0.6 percent of GDP
- Caveat:
  - Net gain in some countries may be tempered by the need to scale back distortive property transfer taxes

### Key determinants of recurrent property tax levels (Box 2 summary)
- Data: panel for 64 countries covering generally 1990–2010; two regression models applied
- Between Effects Model (cross-sectional effects on recurrent immovable property revenue per capita):
  - Main explanatory variables: GDP per capita (GDP PC), proportion of population in urban conglomerations over 1 million (P), openness measured as imports plus exports as a share of GDP (O), and legal heritage dummy (AS = Anglo-Saxon)
  - Specified functional form: ln(R) = .54 ln(GDP PC) + .65 ln(P) + .68 ln(O) + 1.3 AS − 16.3 + ε
  - All explanatory variables shown are significant with a p-value below 0.05
  - Implication: development, urbanization, openness, and legal heritage positively and significantly relate to recurrent immovable property revenue per capita
- Fixed Effects Model (over-time effects within countries):
  - Specified functional form: ln(R_it) = .29 ln(GDP PC_it) + 1.7 ln(P_it) − 4.6 + α_i + ε_it
  - Legal origin dummies dropped as they do not vary over time
  - Openness measure positive but not statistically significant in fixed effects model and therefore not included
  - Interpretation: countries that are generally more open tend to have larger recurrent immovable property revenues, but changes toward openness over time do not necessarily increase property revenues
- Non-linear development effect:
  - Model with GDP per capita and GDP per capita squared:
    - R_it = 1.34 ln(GDP PC_it) − 1.09 [ln(GDP PC_it)]^2 + 2.3 ln(P_it) + α_i + ε_it
  - Result: coefficient of GDP per capita squared statistically significant with p-value 0.02; GDP per capita linear term becomes statistically insignificant
  - Implication: effect of development on immovable property tax revenue is exponential; as countries develop, property tax-to-GDP ratio tends to increase
- Overall conclusions from Box 2:
  - Economic development (wealth) and degree of urbanization explain an important part of variations in property tax revenue per capita
  - Degree of openness and legal origin may be important additional explanatory factors
  - Data limitations prevented analysis of possible impact of corruption

### Efficiency considerations in favor of property taxation
- Efficiency rationale:
  - Recurrent property taxes on land and buildings are generally considered more efficient than many other taxes because their base is relatively immobile (land truly immobile; structures less so)
  - Property taxes generally do not affect decisions to supply labor, invest, or innovate to the same extent as income or corporate taxes
  - If fully capitalized in property prices, property tax changes do not alter the rate of return and are neutral to investment behavior
- Tax-and-growth ranking evidence:
  - OECD (2008 and 2010) identifies recurrent taxes on immovable property (residential in particular) as the least distortive for long-run GDP per capita
  - Ranking (least to most harmful): recurrent immovable property taxes → consumption taxes → personal income taxes → corporate income taxes
  - Policy implication: revenue-neutral, growth-oriented reform would shift part of the base from income taxes to consumption and immovable property taxes
- Local tax advantages:
  - Property tax is considered an ideal local tax: borne mainly by residents, limited spillovers, property values reflect local services, stable and predictable revenue source
  - Allocative efficiency conditional on local autonomy over rate-setting and efficient equalization of tax capacities
- Business property and exemptions:
  - Taxing business property can raise costs disproportionately for businesses that use property intensively; many countries apply reliefs (e.g., agricultural exemptions or lower rates)
- Intergovernmental fiscal effects:
  - Strengthening property taxation can reduce local dependence on transfers and enhance local accountability
  - Transfers could be scaled back to secure improvement in overall fiscal balance while strengthening local fiscal autonomy
- Land-use efficiency:
  - Property taxes can promote efficient use of land; a pure site (land) tax on land value maximizes incentives for optimal land use
- Interaction with other taxes:
  - Higher property taxes could reduce tax bias favoring owner-occupied housing (e.g., exemptions for imputed rent, capital gains, deductibility of interest)
  - Increased property taxes may help reduce reliance on distorting property transfer taxes; some countries have replaced or reduced transfer taxes in favor of recurrent immovable property taxes
- House price volatility and policy limits:
  - Property taxes may have at best a one-off effect on price levels if taxes are capitalized; counter-cyclical use to reduce volatility may not be efficient
  - Non-tax macroprudential tools (e.g., limits on loan-to-value and debt-to-income ratios) may be more effective in some cases
- Resilience in small open economies:
  - Property taxation can render tax systems more resilient to external shocks by relying on immobile bases

### Equity considerations
- Equity debate:
  - Property tax fairness is long-standing and contentious
  - General assumption: property taxes are progressive because land and capital are owned predominantly by higher-income individuals (the “new view”)
  - No clear consensus; incidence in developing and transition economies may be less clear due to less-developed capital markets and ill-defined ownership rights

*Source: _wp13129 - Appendix Tables 3 and 4 also show that the yield of immovable property taxes on average represents about*

### Box 3. Views on the Incidence of Property Taxation

### Box 3. Views on the Incidence of Property Taxation

### Incidence views: traditional, new, and benefit perspectives
- Traditional (“old”) view:
  - Property tax combines a tax on highly mobile capital and immobile land.
  - Tax on capital is shifted fully to renters, consumers, and labor.
  - Tax on land is borne by landowners.
  - Incidence studies based on this view generally find that the property tax is regressive.
- New view (attributed to Mieszkowski, 1972):
  - Assumes capital is in fixed supply, but perfectly mobile across sectors and geography.
  - Tax on capital is a combination of a basic (average) tax rate applied to all capital plus a local differential that varies across jurisdictions.
  - Local differentials incentivize capital reallocation until net after-tax rates of return are equalized.
  - Incidence studies adopting this view find the property tax is progressive (or at least not as regressive) because land and capital are owned by higher-income individuals.
- Benefit view:
  - Treats the property tax as a benefit tax equal to benefits received from public services funded by the tax (Tiebout effect).
  - Property tax acts as a price for local public goods; individuals choose locations matching preferences.
  - Property values may capitalize benefits provided, so a tax on values can represent fair burden-sharing.
  - Implies immovable property taxes are efficient taxes that do not interfere with savings, investment, and labor supply decisions.

### Relevance across country contexts and modeling for developing/transition countries
- The relevance of each view depends on whether property taxes reflect benefits received or are perceived to do so.
- Very limited formal modeling of property tax incidence exists for conditions typical of developing and transition countries.
- Key assumptions of the new view—full capital mobility and a fixed supply of land—are often not met in developing and transition countries, so its predictions may not hold there.
- Findings from simulations with a CGE model tailored to these country conditions (Sennoga, Sjoquist, and Wallace, 2008):
  - Burden of property taxes imposed on capital and land is borne by the owners of capital and land and is not significantly influenced by assumptions regarding capital mobility.
  - Property tax is progressive with the burden borne predominantly by middle-and high-income earners.
  - Since wealth and high-income individuals can be hard to tax in these countries, a property tax—appropriately administered—could offer means of addressing vertical equity concerns.

### Interpreting distributional data and the Denmark example
- Adoption of a specific incidence view is needed to interpret distributional data.
- Data on distribution of the property tax burden are rare.
- An example for Denmark demonstrates interpretation issues:
  - The table provides a decile-distribution of taxpayers with per capita averages of gross income, disposable income, and property taxes within deciles—as well as share of ownership and effective tax rates.
  - Data reflect actual tax liabilities from tax returns (amounts to be paid by property owners within each decile), but legal obligation to pay does not necessarily reflect final, effective incidence.
  - Under the “new” view, Denmark’s property tax appears regressive over the first two deciles and becomes progressive from the third decile and up.
    - Explanation: property ownership increases strongly over deciles; the “new” view assumes renters do not carry any property tax burden, which may be inaccurate.
  - Heterogeneity in low-income deciles (for example, pensioners with low income but valuable property and newly self-employed with low income) complicates interpretation; some countries allow property tax deferrals until change in property ownership to address such problems.
- Valuation approaches and equity:
  - Use of market values is frequently argued to maximize fairness, especially if market values reflect capitalized benefits provided by local services.
  - Area-based taxation (e.g., square meter taxes) unrelated or imperfectly related to actual property values can create variations in effective tax rates that may violate equity considerations.

### The cyclical resilience of property tax revenues
- Concern: High cyclical volatility could render the property tax less appropriate as a local tax.
- Observations around the 2008–10 recession:
  - For OECD countries, inspection of Figure 1 shows basically a flat revenue ratio during the boom years leading into the recession, suggesting low cyclical sensitivity.
- United States evidence:
  - State and local government tax revenues fell steeply following the housing market contraction: state and local tax revenues fell by almost 5.5 percent in 2009.
  - The fall was driven by declines in personal income tax and sales tax receipts: 17 percent and 7.5percent, respectively.
  - In contrast, property tax revenues grew more than 5 percent in both 2008 and 2009, serving as a significant buffer for declines in other tax sources, although property tax revenue stopped growing in subsequent years.
  - Property taxes generally tend to be less volatile than other tax sources—seen as one of the primary virtues of the property tax.
- Drivers of resilience (findings from Lutz (2008) and related research):
  - Estimated elasticity of property tax revenue with respect to home prices equals 0.4.
  - Policymakers tend to offset as much as 60 percent of house price changes by moving the effective tax rate in the opposite direction of house price change.
    - During booms, local governments may spend part of the ‘rent’ on rate reductions; during recessions, budgetary pressures force rate increases.
  - House price changes affect property taxes only after a lag of about three years, reflecting:
    1. Assessments are backward-looking (current year’s taxes based on previous year’s assessed value).
    2. Assessed values often lag market values—by design, legal mandate, or poor administration.
    3. Most states have caps or limits on increases in revenues, taxable assessments, or rates, which can prevent revenues from growing with market values and create a ‘stock’ of untaxed appreciation.

### Policy design and implementation: determinants of revenue yield
- The basic revenue equation:
  - R = B × t × C × V × E
    - R: collected revenue
    - B: legally defined tax base at actual prices
    - t: average tax rate
    - C: ratio of properties actually covered in the tax roll relative to all properties as legally defined
    - V: ratio of assessed to actual value of property in the roll
    - E: level of enforcement measured as actual collections as a share of liabilities or invoices
  - In an ideal world, C, V, and E would equal one, but they rarely do in practice.
- Policy variables and administrative variables determining yield:
  - Definition and measurement of the tax base (B):
    - Methods for assigning value: market price based methods (rental values or capital/market values) and area-based methods.
    - Property components included: land only, buildings/improvements only, or combinations.
    - Treatment by use: residential versus business property, urban versus agricultural land.
  - The specific base definition depends on tax objectives and the depth of local property markets and administrative capacity.
- Relevance for developing countries and urbanization:
  - Urgent need in many developing countries to capture the growing base of urban property to finance infrastructure.
  - UN projections: Africa’s urban population will more than double between 2000 and 2030.
  - Global forecast: world’s urban population will double from 3 billion in 2000 to 6 billion in 2050, with nearly all growth occurring in developing countries.
  - Proposed strategy for some developing countries: introduce a combination of capital value systems for urban places and an area-base system for more rural areas.

*Source: Box 3, _wp13129 - Box 3. Views on the Incidence of Property Taxation_*

### Box 4. Property Valuation Systems

### Box 4. Property Valuation Systems

### Valuation methods and characteristics
- Rental value systems
  - Define the tax base as the rent that can reasonably be expected in a fair market transaction.
  - Used in countries including India, Nigeria, Malaysia, and Trinidad.
  - Practical challenges: scarcity of data on actual rent payments; many properties rarely in rental market (owner-occupied housing, industrial property, vacant land); presence of rent control systems.
  - Assessment approaches: rent surveys combined with expert judgment; estimated capital values converted to rental equivalent; estimated (net) profit of the property.
  - Rental value typically reflects present use and may not reflect best alternative use, reducing incentives for efficient land use.
- Capital value systems
  - Define the base as the market value of the property (land and improvements or structures).
  - Used in most OECD and Latin American countries; trend shifting toward this method.
  - Some countries value land and buildings separately (Botswana, some Brazilian cities); others base assessment on total property value (Cyprus, South Africa).
  - Advantages: captures vacant land value reflecting best alternative use; can be equitable where property value reflects benefits of public investment.
  - Problems: scarcity of market transaction data, under-declaration of prices (e.g., due to high transfer taxes), shortage of expert assessors, potentially high administrative costs.
- Land (site) value systems
  - Tax the market value of land alone; used in Australia, New Zealand, Denmark, Estonia, Jamaica, and Kenya.
  - Advantages: strong incentive for efficient land use; potentially lower administrative costs than capital value tax.
  - Drawbacks: smaller base requires higher nominal tax rates to raise a given revenue; complexity in assessing land-only values in highly urbanized areas.
- Area-based systems
  - Tax each parcel at a specific rate per area unit of land and per area unit of structures.
  - Used in many Central and Eastern European countries and developing countries (e.g., Vietnam, Nigeria) in different forms.
  - Range from ‘pure’ area-only schemes to hybrid forms incorporating zoning and quality indicators (examples: Serbia, Poland, Chile, Indonesia).
  - Advantages: simple, transparent, fairly easy to administer, suitable where property markets are embryonic or absent.
  - Disadvantages: potentially unfair due to sharp differences in effective tax rates; limited buoyancy with market price developments.

### Regional use (Table 4 summary)
- Table totals:
  - Number of Countries: 121
  - Land Value: 16
  - Capital Improved Value: 52
  - Land and Improvements: 8
  - Improvement Only: 4
  - Annual Rental Value: 37
  - Area: 42
  - Flat Rate: 6
- Regional breakdown (numbers preserved as in source):
  - Africa (25): Land Value 1, Capital Improved Value 8, Land and Improvements 3, Improvement Only 4, Annual Rental Value 7, Area 11, Flat Rate 6
  - Caribbean (13): Land Value 4, Capital Improved Value 4, Land and Improvements 2, Improvement Only 0, Annual Rental Value 8, Area 5, Flat Rate 0
  - Asia (24): Land Value 2, Capital Improved Value 6, Land and Improvements 2, Improvement Only 0, Annual Rental Value 11, Area 11, Flat Rate 0
  - Oceania (7): Land Value 6, Capital Improved Value 2, Land and Improvements 0, Improvement Only 0, Annual Rental Value 4, Area 0, Flat Rate 0
  - Western Europe (13): Land Value 0, Capital Improved Value 9, Land and Improvements 0, Improvement Only 0, Annual Rental Value 6, Area 0, Flat Rate 0
  - Eastern Europe (20): Land Value 1, Capital Improved Value 6, Land and Improvements 0, Improvement Only 0, Annual Rental Value 0, Area 15, Flat Rate 0
  - Central and South America (16): Land Value 2, Capital Improved Value 14, Land and Improvements 1, Improvement Only 0, Annual Rental Value 1, Area 0, Flat Rate 0
  - North America (3): Land Value 0, Capital Improved Value 3, Land and Improvements 0, Improvement Only 0, Annual Rental Value 0, Area 0, Flat Rate 0
- Source attribution for table: Michael Bell (2011).

### Exemptions, reliefs, and base erosion
- Common exemptions/special treatments: government property (roads, railroads, pipelines, central government property in local jurisdictions), schools, religious establishments, owner-occupied housing, business incentives.
- Examples and quantitative notes:
  - Owner-occupied housing exemptions can be very costly; example cited: bringing owner-occupied housing fully into the tax net would triple provincial property tax revenues in Punjab province, Pakistan (Bahl (2009) reference in source).
  - One study estimates revenue costs of exempting government property equivalent to about 12 percent of collections in India’s 36 largest cities.
  - Serbia: owner-occupiers receive a 40 percent tax reduction, increased by 10 percent for each member of the household up to a ceiling of 70 percent.
  - Uganda: exemptions include government-owned property, property used for religious purposes, civil servants (police, military), unemployed persons, peasants, and people living in poverty unable to earn the minimum income.
  - Agriculture often receives favorable treatment (partial or full exemption in Nicaragua, Guinea, Tunisia); Serbia gives special treatment resulting in negligible liability; Namibia’s central government land tax is designed mainly to encourage better land use.
- Bottom line: tax bases are often porous and corroded by exemptions and reliefs; scaling back excessive exemptions and reliefs could substantially enhance yields.

### Tax rate structures and examples
- If capital value is the base: flat or progressive rate normally applied; progressivity sometimes achieved via basic property deduction.
- If rental value is the base: flat rate typically applied.
- Area-based taxes: specific flat rate per unit area (e.g., square meter or ha).
- Country examples of rates and structures:
  - Namibia central government tax on agricultural land: basic rate of 0.75 percent; Windhoek urban rates: 0.0734 percent of the site value and 0.0379 percent of the house (improvement) value.
  - Serbia: progressive rate structure set by local governments starting at 0.4 percent up to a maximum of 3 percent.
  - Cambodia: considering a uniform 0.1 percent tax.
  - Kyrgyzstan: dual rate system of 0.35 and 1.0 percent depending on property type.
  - Uganda: municipalities determine rates but with a legal maximum of 2 percent of rateable value.
- Policy note: a simple, transparent, and fairly uniform rate structure minimizes administrative complexity, tax avoidance via misclassification, and misallocation of capital; reduced rates for residential property can incentivize overinvestment in residential property and reduce revenue yield; using a basic threshold for residential taxation is preferable to across-the-board low rates if protecting the poor.

### Coverage, valuation, and enforcement challenges (administrative factors C, V, E)
- Coverage (C)
  - Critical to include nearly all land and improvements in the tax register and keep it updated.
  - Examples:
    - Kenyan municipalities coverage ranges from 30–70 percent.
    - Chile: a large share of new construction not included.
    - Serbia: estimates that previously between 40 and 50 percent of real estate were not in the property register; situation improved after devolution in 2007.
    - Latvia: more than 98 percent of properties included in the tax register (measure may be distorted by privatization process).
  - Low coverage undermines perception of fairness and property tax compliance.
- Valuation (V)
  - Major problem, especially in developing and transition economies.
  - Causes: lack of educated valuators, weak administration, “thin” property markets with insufficient transactions and unreliable sales data.
  - Decentralized vs. central valuation:
    - Legal framework should be uniform and centrally determined.
    - Arguments for local valuation: local knowledge, incentive for local administrations to keep rolls updated.
    - Arguments for central valuation: shortage of qualified local assessors, political pressures on local officers to delay/minimize updates.
    - Practical arrangements: some countries assign valuation to local governments (e.g., Vietnam, Guatemala, Mexico, Brazil); others centralize (Denmark, Lithuania, Latvia, Uruguay); many share responsibilities or use payment systems for valuation services across levels.
  - Assessment ratios and under-valuation:
    - Typical low assessment ratios across methods.
    - Reported ranges: 25 to 50 percent assessment ratios in selected Indian cities (rental value); 10 to 90 percent in selected Latin American cities (market value).
    - Serbia example: for taxpayers keeping business books, book values often well below market values; one municipality analysis found for 83 percent of properties book value is less than 50 percent of market value, with 31 percent of properties lower than 10 percent of market values.
    - Valuation challenges also affect developed countries (example: Germany).
  - Importance of regular updates: falling behind on valuation updates can be politically difficult to correct (Germany example: reliance on assessments dating back to 1964 and 1935; June 2010 judgment required reassessment).
- Transfer taxes interaction with valuation
  - Significant property transfer taxes (stamp duties) incentivize undervaluation and collusion between buyers and sellers, undermining cadastre market information and thinning the market.
  - Examples of high transaction taxes:
    - 15 percent real estate transaction taxes in Senegal and Jamaica (recently reduced).
    - 15 percent Droits d’Enregistrement in the Central African Republic.
    - Namibia transfer duties: 8 percent for individuals with high value property and 12 percent for companies.
    - UK stamp duty maximum rate: 7 percent.
  - Policy option: reduce transaction taxes as part of property tax reform or replace with capital gains taxes on property to reduce incentive for under-declaration.
- Enforcement (E)
  - Enforcement often weak, yielding modest collection ratios (collections as percent of liability/invoices).
  - Examples of collection ratios:
    - Philippines: 50 percent
    - Kenya: 60 percent
    - Croatia: 70 percent
    - Macedonia: 15 percent
    - Latin America: collection ratios at 75 percent or above are generally higher
  - Causes: local authorities collecting taxes may have political incentives not to pursue collections; expected penalties may be too low; large central transfers covering local expenditures can weaken incentives for local tax enforcement.
  - Remedial measures: moving collection points to banks; rewarding improved enforcement with higher transfers; linking property tax payments with provision of utility services.
- Administrative cost and cost-to-revenue ratio
  - Interacting weaknesses in coverage, valuation, and enforcement can reinforce each other and produce a high cost-to-revenue ratio.
  - Example: if coverage and valuation ratios are both about 0.7, total yield could potentially double through aggressive widening of coverage and updating values within existing legal/regulatory frameworks.
  - Upfront investments often required: registration procedures, cadastre, IT systems, and training programs.
  - Evidence on administrative costs is scarce:
    - Latvia example: municipal administrative costs exceed 10 percent of revenues in about half of local governments and reach up to 36 percent (additional central agency costs also incurred); these high ratios influenced by low tax rates and may not be generally applicable.

### Policy implications and recommendations highlighted in the source
- Strengthen coverage: include close to all land and improvements in tax registers and keep registers up to date.
- Improve valuation capacity: invest in qualified valuators, valuation systems, and regular updates; consider appropriate central-local balance in valuation responsibilities where local revenue importance and local capacity vary.
- Address transfer taxes: consider reducing significant transaction taxes to improve market transparency and valuation; alternatively, replace with capital gains taxes to create better self-checking mechanisms.
- Rationalize exemptions and reliefs: scale back excessive exemptions and reliefs (including widespread owner-occupied housing exemptions) and use targeted measures such as basic thresholds to protect the poor.
- Simplify and make rate structures transparent: adopt simple, uniform rate structures to minimize administrative complexity and avoidance; use thresholds, not across-the-board low rates, to protect vulnerable households.
- Strengthen enforcement: improve collection mechanisms, penalties, and incentives for local authorities to pursue collections.
- Invest in administrative infrastructure: cadastre, IT systems, registration procedures, and training; recognize that up-front investments are often necessary and not an insurmountable obstacle to reform.
- Consider payment-in-lieu arrangements where charging government or non-profit property directly is infeasible.

*Source: Box 4. Property Valuation Systems, _wp13129 - Box 4. Property Valuation Systems.*

### Box 5. The Self-Assessment Approach in Bogota City

### Box 5. The Self-Assessment Approach in Bogota City

### Background and reform design
- Prior to the 1993 reform, the property tax in Bogota city was levied only on the less than 50 percent of total property owners included in the cadastral base.
- Cadastral valuations were outdated with property values around 20–30 percent of their market values.
- The 1993 reform introduced a self-assessment scheme requiring taxpayers to declare properties owned and their values, increasing information on the city’s real estate stock.
- The statute set that declared land values could not be less than the highest of:
  - (1) 50 percent of the commercial value;
  - (2) the cadastral valuation; and
  - (3) the previous year’s self-assessment, indexed with inflation.
- The 50 percent provision was repealed in 1994 on grounds it was impossible to assign a market value to every property unless a transaction had occurred.
- To enhance compliance, self-assessed values were used as the basis for calculating capital gains on property under the income tax (applying to a minority of property owners).
- The existence of an autonomous cadastral organization in the city was considered instrumental in implementing greater autonomy over the property tax base.

### Outcomes and impacts
- The reform led to inclusion of a large number of formerly informal properties in the cadastral base and resulted in a doubling of tax filings in one year.
- Taxable values moved closer to market values and property tax revenues in real terms grew by 77 percent in 1994.
- The scheme produced a sustained increase in the number of properties declaring the tax throughout the following decade.

### Subsequent developments and recalibration
- In the late 1990s, property values dropped significantly due to the economic recession; in many cases the minimum legal value determined by self-assessment became higher than the market value.
- National legislation in 2000 eliminated the self-assessment provision and introduced the Urban and Rural Property Valuation Index (IVIUR), intended to update cadastral values not adjusted by field activity and calculated as the average increase in property prices estimated by the Cadastre Office.
- The shift caused an increase in the number of taxpayers declaring the cadastral value, from 72 percent in 2000 to 85 percent in 2002.
- Subsequent valuation improvements and substantially increased coverage of cadastral updating led to a historical record in updated properties and produced a ratio between the cadastral valuation and commercial value of around 81 per cent in 2004.

### Key lessons and policy implications
- Self-assessment can rapidly expand coverage of the tax base and improve declared values, but can produce distortions if market conditions change (e.g., recession-driven falls in market values).
- Autonomous cadastral capacity is instrumental for successful reform implementation.
- Complementary tools (legal limits, indices such as IVIUR, and cadastral updating programs) are necessary to maintain alignment between cadastral and market values over time.
- Using declared values for related taxes (for example, capital gains under income tax) can strengthen compliance, though applicability may be limited to a subset of owners.
- Reforms that increase taxable values can produce substantial short-term revenue gains (example: 77 percent real growth in 1994) but require mechanisms to adjust to subsequent market fluctuations.

*Source: IMF working paper excerpt.*

### Appendix Table 1. Property Taxes in OECD Countries, 2010

### _wp13129 - Appendix Table 1. Property Taxes in OECD Countries, 2010

### Overview: scope and definitions
- Table reports "Taxes on Property" — "Recurrent Taxes on Immovable Property" for General Government and Local Government by country for 2009–2010.
- Columns provided (as in the source): Year; WB Income Level; GDP/Capita (US$); % of GDP; % of Total General Taxes; % of GDP (local); % of Total General Taxes (local); % of Total Local Taxes; % of General Property Tax.
- Source data: OECD Revenues Statistics and GFS (GFS noted explicitly for non-OECD table).

### Key cross-country findings (OECD sample)
- Highest reported recurrent property tax (% of GDP) in the OECD sample:
  - United Kingdom (2010): 4.23 percent of GDP; % of Total General Taxes = 14.92 percent; Local % of GDP = 3.42 percent; Local % of Total General Taxes = 12.06 percent; % of General Property Tax = 100.00 percent; % of Total Local Taxes = 51.81.
  - France (2010): 3.65 percent of GDP; % of Total General Taxes = 13.89 percent; Local % of GDP = 2.46 percent; Local % of Total General Taxes = 9.37 percent; % of General Property Tax = 100.00 percent; % of Total Local Taxes = 53.44.
  - Canada (2010): 3.49 percent of GDP; % of Total General Taxes = 13.32 percent; Local % of GDP = 3.04 percent; Local % of Total General Taxes = 11.61 percent; % of General Property Tax = 91.05 percent; % of Total Local Taxes = 91.98.
  - United States (2010): 3.21 percent of GDP; % of Total General Taxes = 17.49 percent; Local % of GDP = 3.07 percent; Local % of Total General Taxes = 16.76 percent; % of General Property Tax = 73.03 percent; % of Total Local Taxes = 96.68.
- Other notable OECD values:
  - Japan (2010): 2.70 percent of GDP; % of Total General Taxes = 16.98 percent; Local % of GDP = 2.14 percent; Local % of Total General Taxes = 13.47 percent; % of General Property Tax = 30.01; % of Total Local Taxes = 100.00.
  - Australia (2009): 2.48 percent of GDP; % of Total General Taxes = 9.56 percent; Local % of GDP = 1.45 percent; Local % of Total General Taxes = 5.59 percent; % of General Property Tax = 100.00; % of Total Local Taxes = 62.03.
  - Luxembourg (2010): 2.65 percent of GDP; % of Total General Taxes = 10.28 percent; Local % of GDP = 0.07 percent; Local % of Total General Taxes = 0.29 percent; % of General Property Tax = 4.55; % of Total Local Taxes = 100.00.
- Lowest reported recurrent property tax (% of GDP) in the OECD sample:
  - Slovak Republic (2010): 0.42 percent of GDP; % of Total General Taxes = 2.61 percent; Local % of GDP = 0.42 percent; % of General Property Tax = 50.85; % of Total Local Taxes = 100.00.
  - Czech Republic (2010): 0.44 percent of GDP; % of Total General Taxes = 2.30 percent; Local % of GDP = 0.24 percent; % of General Property Tax = 51.19; % of Total Local Taxes = 100.00.

### Patterns on local vs. general government shares (OECD)
- Many OECD countries report the full incidence of recurrent property taxes at the local level (Local % of General Property Tax = 100.00). Examples include: Austria (reported 88.89 for % of General Property Tax but 100.00 under % of Total Local Taxes), Czech Republic, Denmark, Estonia, Finland, France, Germany, Hungary, Iceland, Italy, Luxembourg, New Zealand, Poland, Portugal, Slovak Republic, Slovenia, Spain, Switzerland (71.59 under % of Total Local Taxes), Turkey, etc. (see table for full country-by-country values).
- In several large OECD economies local shares are high but not universal:
  - United States: % of General Property Tax = 73.03; % of Total Local Taxes = 96.68.
  - Japan: % of General Property Tax = 30.01; % of Total Local Taxes = 100.00.
  - United Kingdom: % of General Property Tax = 100.00; % of Total Local Taxes = 51.81.
  - Canada: % of General Property Tax = 91.05; % of Total Local Taxes = 91.98.

### Non‑OECD sample: levels and composition (selected highlights)
- Highest reported recurrent property tax (% of GDP) in non‑OECD sample:
  - Argentina (2009): 2.90 percent of GDP; % of Total General Taxes = 11.91 percent; Local % of GDP = 0.36 percent; Local % of Total General Taxes = 1.47 percent; % of General Property Tax = 100.00.
  - China, P.R.: Mainland (2009): 1.73 percent of GDP; % of Total General Taxes = 9.91 percent; Local % of GDP = 0.51 percent; Local % of Total General Taxes = 2.90 percent; % of General Property Tax = 6.05; % of Total Local Taxes = 100.00.
  - Russian Federation (2010): 1.22 percent of GDP; % of Total General Taxes = 4.43 percent; Local % of GDP = 1.23 percent; Local % of Total General Taxes = 4.44 percent; % of General Property Tax = 16.76; % of Total Local Taxes = 23.41.
- Other notable non‑OECD values:
  - Brazil (2009): 1.12 percent of GDP; % of Total General Taxes = 4.87 percent; Local % of GDP = 0.40 percent; Local % of Total General Taxes = 1.74 percent; % of General Property Tax = 29.95; % of Total Local Taxes = 96.48.
  - Colombia (2009): 1.51 percent of GDP; % of Total General Taxes = 9.29 percent; Local % of GDP = 0.50 percent; Local % of Total General Taxes = 3.06 percent; % of General Property Tax = 24.46; % of Total Local Taxes = 100.00.
- Many non‑OECD countries report that recurrent property taxes are primarily a local government revenue source (Local % of General Property Tax often 100.00). Examples explicitly reported as 100.00 in the table include: Albania, Argentina, Armenia, Belarus, Bulgaria, Cape Verde, Colombia, Costa Rica, Dominican Republic, Egypt, Georgia, Guatemala, Jordan, Latvia, Moldova, Mongolia, Paraguay, Peru, Serbia, Singapore, St. Kitts and Nevis, Ukraine, and others.

### Country-level examples (selected exact entries from tables)
- Australia (2009): WB Income Level = High income; GDP/Capita (US$) = 44816.93; % of GDP = 2.48; % of Total General Taxes = 9.56; Local % of GDP = 1.45; Local % of Total General Taxes = 5.59; % of Total Local Taxes = 100.00; % of General Property Tax = 62.03.
- France (2010): WB Income Level = High income; GDP/Capita (US$) = 40808.86; % of GDP = 3.65; % of Total General Taxes = 13.89; Local % of GDP = 2.46; Local % of Total General Taxes = 9.37; % of Total Local Taxes = 53.44; % of General Property Tax = 100.00.
- United States (2010): WB Income Level = High income; GDP/Capita (US$) = 46900.39; % of GDP = 3.21; % of Total General Taxes = 17.49; Local % of GDP = 3.07; Local % of Total General Taxes = 16.76; % of Total Local Taxes = 73.03; % of General Property Tax = 96.68.
- Argentina (2009): WB Income Level = Upper middle; GDP/Capita (US$) = 7732.80; % of GDP = 2.90; % of Total General Taxes = 11.91; Local % of GDP = 0.36; Local % of Total General Taxes = 1.47; % of Total Local Taxes = 100.00; % of General Property Tax = 100.00.
- China, P.R.: Mainland (2009): WB Income Level = Upper middle; GDP/Capita (US$) = 3738.95; % of GDP = 1.73; % of Total General Taxes = 9.91; Local % of GDP = 0.51; Local % of Total General Taxes = 2.90; % of Total Local Taxes = 6.05; % of General Property Tax = 100.00.

### Observations on income-level patterns
- High income countries in the OECD sample often show larger absolute recurrent property tax receipts as a share of GDP (examples: United Kingdom 4.23; France 3.65; Canada 3.49).
- Upper and lower middle income non‑OECD countries exhibit a wide range of recurrent property tax shares (% of GDP), from low values (e.g., Mongolia 0.16 percent of GDP) to moderate values (e.g., Argentina 2.90 percent of GDP; China 1.73 percent of GDP).

*Source: OECD Revenues Statistics and GFS.*

### Appendix Table 3. Property Taxes in High-Income Countries, 2010

### Appendix Table 3. Property Taxes in High-Income Countries, 2010

### Table structure and headings
- Data classification: Taxes on Property — Recurrent Taxes on Immovable Property
- Columns (as presented):
  - Country, Year, OECD (Y/N), WB Income Level
  - GDP/Capita (US$)
  - General Government: % of GDP; % of Total General Taxes
  - Local Government: % of GDP; % of Total General Taxes
  - % of Total Local Taxes
  - % of General Property Tax

### Country-level figures (as reported)
- Australia — 2009 — Y — High income — GDP/Capita (US$): 44816.93
  - General Government: % of GDP: 2.48; % of Total General Taxes: 9.56
  - Local Government: % of GDP: 1.45; % of Total General Taxes: 5.59
  - % of Total Local Taxes: 100.00; % of General Property Tax: 62.03

- Austria — 2010 — Y — High income — GDP/Capita (US$): 45270.84
  - General Government: % of GDP: 0.54; % of Total General Taxes: 1.96
  - Local Government: % of GDP: 0.23; % of Total General Taxes: 0.85
  - % of Total Local Taxes: 15.17; % of General Property Tax: 88.89

- Belgium — 2010 — Y — High income — GDP/Capita (US$): 43378.80
  - General Government: % of GDP: 3.00; % of Total General Taxes: 10.15
  - Local Government: % of GDP: 1.24; % of Total General Taxes: 4.19
  - % of Total Local Taxes: 54.12; % of General Property Tax: 95.97

- Canada — 2010 — Y — High income — GDP/Capita (US$): 46282.86
  - General Government: % of GDP: 3.49; % of Total General Taxes: 13.32
  - Local Government: % of GDP: 3.04; % of Total General Taxes: 11.61
  - % of Total Local Taxes: 91.05; % of General Property Tax: 91.98

- Croatia — 2010 — N — High income — GDP/Capita (US$): 13775.86
  - General Government: % of GDP: 0.26; % of Total General Taxes: 1.23
  - Local Government: % of GDP: 0.01; % of Total General Taxes: 0.06
  - % of Total Local Taxes: 0.47; % of General Property Tax: 100.00

- Czech Republic — 2010 — Y — High income — GDP/Capita (US$): 18813.94
  - General Government: % of GDP: 0.44; % of Total General Taxes: 2.30
  - Local Government: % of GDP: 0.24; % of Total General Taxes: 1.22
  - % of Total Local Taxes: 51.19; % of General Property Tax: 100.00

- Denmark — 2010 — Y — High income — GDP/Capita (US$): 56369.20
  - General Government: % of GDP: 1.93; % of Total General Taxes: 4.09
  - Local Government: % of GDP: 1.38; % of Total General Taxes: 2.93
  - % of Total Local Taxes: 10.79; % of General Property Tax: 100.00

- Estonia — 2010 — Y — High income — GDP/Capita (US$): 14137.65
  - General Government: % of GDP: 0.36; % of Total General Taxes: 1.72
  - Local Government: % of GDP: 0.36; % of Total General Taxes: 1.72
  - % of Total Local Taxes: 7.87; % of General Property Tax: 100.00

- Finland — 2010 — Y — High income — GDP/Capita (US$): 44364.37
  - General Government: % of GDP: 1.16; % of Total General Taxes: 3.91
  - Local Government: % of GDP: 0.65; % of Total General Taxes: 2.19
  - % of Total Local Taxes: 6.31; % of General Property Tax: 100.00

- France — 2010 — Y — High income — GDP/Capita (US$): 40808.86
  - General Government: % of GDP: 3.65; % of Total General Taxes: 13.89
  - Local Government: % of GDP: 2.46; % of Total General Taxes: 9.37
  - % of Total Local Taxes: 53.44; % of General Property Tax: 100.00

- Germany — 2010 — Y — High income — GDP/Capita (US$): 40197.67
  - General Government: % of GDP: 0.85; % of Total General Taxes: 3.83
  - Local Government: % of GDP: 0.46; % of Total General Taxes: 2.07
  - % of Total Local Taxes: 15.87; % of General Property Tax: 100.00

- Greece — 2009 — Y — High income — GDP/Capita (US$): 29328.08
  - General Government: % of GDP: 1.24; % of Total General Taxes: 6.26
  - Local Government: % of GDP: 0.17; % of Total General Taxes: 0.86
  - % of Total Local Taxes: 31.68; % of General Property Tax: 37.65

- Hungary — 2010 — Y — High income — GDP/Capita (US$): 12845.41
  - General Government: % of GDP: 1.16; % of Total General Taxes: 4.43
  - Local Government: % of GDP: 0.35; % of Total General Taxes: 1.33
  - % of Total Local Taxes: 14.19; % of General Property Tax: 100.00

- Iceland — 2010 — Y — High income — GDP/Capita (US$): 38891.77
  - General Government: % of GDP: 2.47; % of Total General Taxes: 7.69
  - Local Government: % of GDP: 1.82; % of Total General Taxes: 5.68
  - % of Total Local Taxes: 20.21; % of General Property Tax: 99.51

- Ireland — 2010 — Y — High income — GDP/Capita (US$): 46298.09
  - General Government: % of GDP: 1.56; % of Total General Taxes: 6.99
  - Local Government: % of GDP: 0.88; % of Total General Taxes: 3.96
  - % of Total Local Taxes: 100.00; % of General Property Tax: 100.00

- Israel — 2010 — Y — High income — GDP/Capita (US$): 29264.07
  - General Government: % of GDP: 3.12; % of Total General Taxes: 11.63
  - Local Government: % of GDP: 2.32; % of Total General Taxes: 8.64
  - % of Total Local Taxes: 95.18; % of General Property Tax: 99.74

- Italy — 2010 — Y — High income — GDP/Capita (US$): 34154.38
  - General Government: % of GDP: 2.02; % of Total General Taxes: 6.86
  - Local Government: % of GDP: 0.59; % of Total General Taxes: 2.02
  - % of Total Local Taxes: 9.04; % of General Property Tax: 100.00

- Japan — 2010 — Y — High income — GDP/Capita (US$): 43014.64
  - General Government: % of GDP: 2.70; % of Total General Taxes: 16.98
  - Local Government: % of GDP: 2.14; % of Total General Taxes: 13.47
  - % of Total Local Taxes: 30.01; % of General Property Tax: 100.00

- Korea, Republic of — 2010 — Y — High income — GDP/Capita (US$): 20764.59
  - General Government: % of GDP: 2.86; % of Total General Taxes: 14.77
  - Local Government: % of GDP: 0.79; % of Total General Taxes: 4.08
  - % of Total Local Taxes: 16.34; % of General Property Tax: 86.71

- Luxembourg — 2010 — Y — High income — GDP/Capita (US$): 105509.30
  - General Government: % of GDP: 2.65; % of Total General Taxes: 10.28
  - Local Government: % of GDP: 0.07; % of Total General Taxes: 0.29
  - % of Total Local Taxes: 4.55; % of General Property Tax: 100.00

- Netherlands — 2009 — Y — High income — GDP/Capita (US$): 48151.04
  - General Government: % of GDP: 1.49; % of Total General Taxes: 6.11
  - Local Government: % of GDP: 0.69; % of Total General Taxes: 2.83
  - % of Total Local Taxes: 48.10; % of General Property Tax: 97.25

- New Zealand — 2010 — Y — High income — GDP/Capita (US$): 32225.99
  - General Government: % of GDP: 2.16; % of Total General Taxes: 6.89
  - Local Government: % of GDP: 2.11; % of Total General Taxes: 6.75
  - % of Total Local Taxes: 89.16; % of General Property Tax: 100.00

- Norway — 2010 — Y — High income — GDP/Capita (US$): 85055.45
  - General Government: % of GDP: 1.24; % of Total General Taxes: 3.75
  - Local Government: % of GDP: 0.34; % of Total General Taxes: 1.03
  - % of Total Local Taxes: 4.82; % of General Property Tax: 83.78

- Poland — 2009 — Y — High income — GDP/Capita (US$): 11275.06
  - General Government: % of GDP: 1.23; % of Total General Taxes: 6.00
  - Local Government: % of GDP: 1.20; % of Total General Taxes: 5.89
  - % of Total Local Taxes: 28.59; % of General Property Tax: 100.00

- Portugal — 2010 — Y — High income — GDP/Capita (US$): 21525.65
  - General Government: % of GDP: 1.19; % of Total General Taxes: 5.32
  - Local Government: % of GDP: 0.65; % of Total General Taxes: 2.91
  - % of Total Local Taxes: 38.07; % of General Property Tax: 100.00

- Singapore — 2010 — N — High income — GDP/Capita (US$): 43864.74
  - General Government: % of GDP: 0.90; % of Total General Taxes: 6.66
  - Local Government: % of GDP: 0.90; % of Total General Taxes: 6.65
  - % of Total Local Taxes: 100.00; % of General Property Tax: (blank)

- Slovak Republic — 2010 — Y — High income — GDP/Capita (US$): 16049.85
  - General Government: % of GDP: 0.42; % of Total General Taxes: 2.61
  - Local Government: % of GDP: 0.42; % of Total General Taxes: 2.61
  - % of Total Local Taxes: 50.85; % of General Property Tax: 100.00

- Slovenia — 2010 — Y — High income — GDP/Capita (US$): 23281.55
  - General Government: % of GDP: 0.62; % of Total General Taxes: 2.75
  - Local Government: % of GDP: 0.49; % of Total General Taxes: 2.17
  - % of Total Local Taxes: 11.89; % of General Property Tax: 100.00

- Spain — 2010 — Y — High income — GDP/Capita (US$): 30333.75
  - General Government: % of GDP: 1.94; % of Total General Taxes: 9.82
  - Local Government: % of GDP: 0.81; % of Total General Taxes: 4.12
  - % of Total Local Taxes: 28.84; % of General Property Tax: 100.00

- St. Kitts and Nevis — 2010 — N — High income — GDP/Capita (US$): 12216.25
  - General Government: % of GDP: 0.51; % of Total General Taxes: 3.02
  - Local Government: % of GDP: 0.51; % of Total General Taxes: 2.73
  - % of Total Local Taxes: 100.00; % of General Property Tax: (blank)

- Sweden — 2010 — Y — High income — GDP/Capita (US$): 49078.05
  - General Government: % of GDP: 1.10; % of Total General Taxes: 3.21
  - Local Government: % of GDP: 0.80; % of Total General Taxes: 2.32
  - % of Total Local Taxes: 2.62; % of General Property Tax: 53.45

- Switzerland — 2010 — Y — High income — GDP/Capita (US$): 67766.36
  - General Government: % of GDP: 2.22; % of Total General Taxes: 9.68
  - Local Government: % of GDP: 0.09; % of Total General Taxes: 0.38
  - % of Total Local Taxes: 1.34; % of General Property Tax: 71.59

- United Kingdom — 2010 — Y — High income — GDP/Capita (US$): 36371.26
  - General Government: % of GDP: 4.23; % of Total General Taxes: 14.92
  - Local Government: % of GDP: 3.42; % of Total General Taxes: 12.06
  - % of Total Local Taxes: 100.00; % of General Property Tax: 51.81

- United States — 2010 — Y — High income — GDP/Capita (US$): 46900.39
  - General Government: % of GDP: 3.21; % of Total General Taxes: 17.49
  - Local Government: % of GDP: 3.07; % of Total General Taxes: 16.76
  - % of Total Local Taxes: 73.03; % of General Property Tax: 96.68

### Aggregate figure reported
- Average: High Income — GDP/Capita (US$): 38011.26
  - General Government: % of GDP: 1.78; % of Total General Taxes: 7.36
  - Local Government: % of GDP: 1.06; % of Total General Taxes: 4.46
  - % of Total Local Taxes: 37.65; % of General Property Tax: 91.68

*Source: OECD Revenues Statistics and GFS.*

### Appendix Table 4. Property Taxes in Middle- and Low-Income Countries, 2010

### Appendix Table 4. Property Taxes in Middle- and Low-Income Countries, 2010

### Summary statistic (aggregate)
- Average: Middle Income
  - GDP/Capita (US$): 5367.11
  - General Government % of GDP: 0.76
  - General Government % of Total General Taxes: 4.00
  - Local Government % of GDP: 0.40
  - Local Government % of Total General Taxes: 2.12
  - % of Total Local Taxes: 35.48
  - % of General Property Tax: 89.87

### Upper middle income — country-level indicators (selected rows as presented)
- Argentina
  - Year: 2009
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 7732.80
  - General Government % of GDP: 2.90
  - General Government % of Total General Taxes: 11.91
  - Local Government % of GDP: 0.36
  - Local Government % of Total General Taxes: 1.47
  - % of Total Local Taxes: 100.00
- Azerbaijan, Rep. of
  - Year: 2010
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 5712.95
  - General Government % of GDP: 0.36
  - General Government % of Total General Taxes: 2.84
  - Local Government % of GDP: 0.36
  - Local Government % of Total General Taxes: 2.84
  - % of Total Local Taxes: 96.08
  - % of General Property Tax: 6.62
- Belarus
  - Year: 2010
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 5824.38
  - General Government % of GDP: 1.12
  - General Government % of Total General Taxes: 4.12
  - Local Government % of GDP: 0.43
  - Local Government % of Total General Taxes: 1.58
  - % of Total Local Taxes: 4.16
  - % of General Property Tax: 100.00
- Brazil
  - Year: 2009
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 8472.46
  - General Government % of GDP: 1.12
  - General Government % of Total General Taxes: 4.87
  - Local Government % of GDP: 0.40
  - Local Government % of Total General Taxes: 1.74
  - % of Total Local Taxes: 29.95
  - % of General Property Tax: 96.48
- Bulgaria
  - Year: 2010
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 6359.45
  - General Government % of GDP: 1.41
  - General Government % of Total General Taxes: 7.06
  - Local Government % of GDP: 0.94
  - Local Government % of Total General Taxes: 4.70
  - % of Total Local Taxes: 65.26
  - % of General Property Tax: 100.00
- Chile
  - Year: 2010
  - OECD: Y
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 12570.73
  - General Government % of GDP: 0.76
  - General Government % of Total General Taxes: 3.89
  - Local Government % of GDP: 0.53
  - Local Government % of Total General Taxes: 2.72
  - % of Total Local Taxes: 40.33
  - % of General Property Tax: 98.49
- China, P.R.: Mainland
  - Year: 2009
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 3738.95
  - General Government % of GDP: 1.73
  - General Government % of Total General Taxes: 9.91
  - Local Government % of GDP: 0.51
  - Local Government % of Total General Taxes: 2.90
  - % of Total Local Taxes: 6.05
  - % of General Property Tax: 100.00
- Colombia
  - Year: 2009
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 5188.79
  - General Government % of GDP: 1.51
  - General Government % of Total General Taxes: 9.29
  - Local Government % of GDP: 0.50
  - Local Government % of Total General Taxes: 3.06
  - % of Total Local Taxes: 24.46
  - % of General Property Tax: 100.00
- Costa Rica
  - Year: 2009
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 6519.66
  - General Government % of GDP: 0.29
  - General Government % of Total General Taxes: 2.10
  - Local Government % of GDP: 0.20
  - Local Government % of Total General Taxes: 1.49
  - % of Total Local Taxes: 32.69
  - % of General Property Tax: 100.00
- Dominican Republic
  - Year: 2009
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 4814.82
  - General Government % of GDP: 0.53
  - General Government % of Total General Taxes: 4.04
  - Local Government % of GDP: 0.03
  - Local Government % of Total General Taxes: 0.21
  - % of General Property Tax: 100.00
- Jordan
  - Year: 2009
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 3986.56
  - General Government % of GDP: 0.48
  - General Government % of Total General Taxes: 2.67
  - Local Government % of GDP: 0.48
  - Local Government % of Total General Taxes: 2.67
  - % of Total Local Taxes: 100.00
- Kazakhstan
  - Year: 2010
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 9008.70
  - General Government % of GDP: 0.68
  - General Government % of Total General Taxes: 5.08
  - Local Government % of GDP: 0.56
  - Local Government % of Total General Taxes: 4.18
  - % of Total Local Taxes: 14.55
  - % of General Property Tax: 100.00
- Latvia
  - Year: 2010
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 10680.53
  - General Government % of GDP: 0.70
  - General Government % of Total General Taxes: 3.82
  - Local Government % of GDP: 0.70
  - Local Government % of Total General Taxes: 3.82
  - % of Total Local Taxes: 12.45
  - % of General Property Tax: 100.00
- Mexico
  - Year: 2009
  - OECD: Y
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 7970.16
  - General Government % of GDP: 0.30
  - General Government % of Total General Taxes: 2.05
  - Local Government % of GDP: 0.19
  - Local Government % of Total General Taxes: 1.32
  - % of Total Local Taxes: 57.39
  - % of General Property Tax: 68.75
- Peru
  - Year: 2009
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 4370.44
  - General Government % of GDP: 0.52
  - General Government % of Total General Taxes: 3.69
  - Local Government % of GDP: 0.17
  - Local Government % of Total General Taxes: 1.22
  - % of Total Local Taxes: 25.52
  - % of General Property Tax: 100.00
- Russian Federation
  - Year: 2010
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 10407.93
  - General Government % of GDP: 1.22
  - General Government % of Total General Taxes: 4.43
  - Local Government % of GDP: 1.23
  - Local Government % of Total General Taxes: 4.44
  - % of Total Local Taxes: 16.76
  - % of General Property Tax: 23.41
- Serbia, Republic of
  - Year: 2010
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 5141.72
  - General Government % of GDP: 0.67
  - General Government % of Total General Taxes: 2.77
  - Local Government % of GDP: 0.41
  - Local Government % of Total General Taxes: 1.70
  - % of Total Local Taxes: 12.19
  - % of General Property Tax: 100.00
- Tunisia
  - Year: 2010
  - OECD: N
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 4199.35
  - General Government % of GDP: 0.53
  - General Government % of Total General Taxes: 2.57
  - Local Government % of GDP: 0.10
  - Local Government % of Total General Taxes: 0.49
  - % of Total Local Taxes: 17.27
  - % of General Property Tax: 84.96
- Turkey
  - Year: 2010
  - OECD: Y
  - WB Income Level: Upper middle
  - GDP/Capita (US$): 10062.43
  - General Government % of GDP: 1.06
  - General Government % of Total General Taxes: 5.40
  - Local Government % of GDP: 0.24
  - Local Government % of Total General Taxes: 1.24
  - % of Total Local Taxes: 9.96
  - % of General Property Tax: 100.00

### Lower middle income — country-level indicators (selected rows as presented)
- Albania
  - Year: 2010
  - OECD: N
  - WB Income Level: Lower middle
  - GDP/Capita (US$): 3714.65
  - General Government % of GDP: 0.15
  - General Government % of Total General Taxes: 0.79
  - Local Government % of GDP: 0.15
  - Local Government % of Total General Taxes: 0.79
  - % of Total Local Taxes: 100.00
- Armenia
  - Year: 2010
  - OECD: N
  - WB Income Level: Lower middle
  - GDP/Capita (US$): 2840.43
  - General Government % of GDP: 0.45
  - General Government % of Total General Taxes: 2.78
  - Local Government % of GDP: 0.24
  - Local Government % of Total General Taxes: 1.50
  - % of Total Local Taxes: 45.11
  - % of General Property Tax: 100.00
- Cape Verde
  - Year: 2009
  - OECD: N
  - WB Income Level: Lower middle
  - GDP/Capita (US$): 3174.52
  - General Government % of GDP: 0.47
  - General Government % of Total General Taxes: 2.32
  - Local Government % of GDP: 0.47
  - Local Government % of Total General Taxes: 2.32
  - % of Total Local Taxes: 70.62
  - % of General Property Tax: 100.00
- Egypt
  - Year: 2010
  - OECD: N
  - WB Income Level: Lower middle
  - GDP/Capita (US$): 2808.04
  - General Government % of GDP: 0.73
  - General Government % of Total General Taxes: 5.14
  - Local Government % of GDP: 0.04
  - Local Government % of Total General Taxes: 0.30
  - % of Total Local Taxes: 100.00
- Georgia
  - Year: 2010
  - OECD: N
  - WB Income Level: Lower middle
  - GDP/Capita (US$): 2623.38
  - General Government % of GDP: 0.92
  - General Government % of Total General Taxes: 3.95
  - Local Government % of GDP: 0.92
  - Local Government % of Total General Taxes: 3.95
  - % of Total Local Taxes: 69.68
  - % of General Property Tax: 100.00
- Guatemala
  - Year: 2009
  - OECD: N
  - WB Income Level: Lower middle
  - GDP/Capita (US$): 2686.47
  - General Government % of GDP: 0.19
  - General Government % of Total General Taxes: 1.82
  - Local Government % of GDP: 0.19
  - Local Government % of Total General Taxes: 1.79
  - % of Total Local Taxes: 100.00
  - % of General Property Tax: 100.00
- Moldova
  - Year: 2010
  - OECD: N
  - WB Income Level: Lower middle
  - GDP/Capita (US$): 1634.52
  - General Government % of GDP: 0.39
  - General Government % of Total General Taxes: 1.91
  - Local Government % of GDP: 0.14
  - Local Government % of Total General Taxes: 0.68
  - % of Total Local Taxes: 3.91
  - % of General Property Tax: 100.00
- Mongolia
  - Year: 2010
  - OECD: N
  - WB Income Level: Lower middle
  - GDP/Capita (US$): 2266.65
  - General Government % of GDP: 0.16
  - General Government % of Total General Taxes: 0.65
  - Local Government % of GDP: 0.16
  - Local Government % of Total General Taxes: 0.65
  - % of Total Local Taxes: 6.77
  - % of General Property Tax: 100.00
- Paraguay
  - Year: 2010
  - OECD: N
  - WB Income Level: Lower middle
  - GDP/Capita (US$): 2961.17
  - General Government % of GDP: 0.28
  - General Government % of Total General Taxes: 2.07
  - Local Government % of GDP: 0.27
  - Local Government % of Total General Taxes: 1.98
  - % of Total Local Taxes: 54.53
  - % of General Property Tax: 100.00
- Ukraine
  - Year: 2010
  - OECD: N
  - WB Income Level: Lower middle
  - GDP/Capita (US$): 3012.80
  - General Government % of GDP: 0.79
  - General Government % of Total General Taxes: 3.07
  - Local Government % of GDP: 0.79
  - Local Government % of Total General Taxes: 3.07
  - % of Total Local Taxes: 12.83
  - % of General Property Tax: 100.00

### Low income — country-level indicator (selected row)
- Afghanistan, I.R. of
  - Year: 2010
  - OECD: N
  - WB Income Level: Low income
  - GDP/Capita (US$): 527.77
  - General Government % of GDP: 0.27
  - General Government % of Total General Taxes: 3.01
  - Local Government % of GDP: 0.23
  - Local Government % of Total General Taxes: 2.65
  - % of Total Local Taxes: 58.48
  - % of General Property Tax: 17.46

_Appendix Table 4. Property Taxes in Middle- and Low-Income Countries, 2010 (extracted figures only)_

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_Source: https://www.imf.org/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/wp/2013/_wp13129.pdf_