Accra, Ghana//-Ghana’s Minister for Local Government, Chieftaincy and Religious Affairs, Ahmed Ibrahim, is optimistic that Metropolitan, Municipal and District Assemblies (MMDAs) would do better in property tax collection than the centralised approach.
Over the years, the Ministry for Local Government spearheaded reforms to enhance the fiscal autonomy of the various MMDAs by improving their capacity to generate and manage their source revenues, including property taxes.
The MMDAs were historically solely responsible for property tax collection as stipulated in section 144 of the Local Governance Act, 2016 (Act 936).
However, a Unified Common Platform was introduced by the erstwhile Government under the aegis of the Ghana Revenue Authority (GRA) to administer and manage the collection of property rates in the MMDAs.
While this system aimed to enhance national oversight and streamline collections, it affected the revenue mobilisation drive of the local authorities as the arrangement was fraught with a myriad of challenges and denying the MMDAs revenue from the collection of property rates.
Due to these challenges coupled with incessant demands by local government practitioners including Civil Society Organisations (CSOs), the previous government in its 2023 Budget and Economic Policy Statement suspended the collection of property rates by the vendor engaged by GRA and consequently directed the MMDAs to collect property rates until the resolution of issues related to the private sector participation.
Speaking in an interview with journalists after the opening of a three-day African Cities Research Consortium (ACRC) International Urban Property Tax Workshop in Accra, Mr Ibrahim explained that the erstwhile administration realised that the centralised approach could not work, and “that is why we are not going to re-introduce it”.
He said the current government is going through the approval of the newly nominated Metropolitan, Municipal and District Chief Executives (MMDCEs), after that, they would organise a comprehensive orientation for the local assemblies on property tax collection to enable them to perform the task.
At the orientation, which will be graced by President John Dramani Mahama, all the modalities will be opened for them and follow suit, according to him.
After conducting two key studies into the operations of some local authorities within this short time as the sector minister, Mr Ibrahim acknowledged that they were collecting less property tax.
In his own words: “I have engaged a number of them. In the Greater Accra Region here, I engaged the Accra Metropolitan Assembly (AMA), Korle Klottey Municipal Assembly (KoKMA), and other assemblies, and you could see that during the operations, they were collecting less.
During the suspension of the centralised property tax, the MMDAs were collecting more. So, who will choose less and leave more? We are going for more, he stated.
“A case in point is the Korle Klottey Municipal Assembly (KoKMA) during the centralised system operation, they were getting GHC2 million in a year.
However, in 2023, when it was suspended, the same KoKMA collected GHC12 million, showing a GHC10 million difference.
So, you could see if you give them the power to do it, they can do it and do it better. And other assemblies must follow suit”.
The German development co-operation, the minister noted, had trained a lot of assemblies by building their capacity in property tax collection.
The co-operation was rolling it out, but in the process, it was suspended. So, we are going for the district-level revenue collection, and that is what it is going to be. It must happen this year.
“Even centralised property tax collection was suspended by those who brought it. So, who is going to reintroduce it? Is it me? No”, Mr Ibrahim said.
Delivering the keynote address of the workshop earlier, he indicated that the Local Government Ministry sees this workshop as timely as it speaks directly to the aim of the ACRC’s vision to generate robust insights and evidence that will help improve the living conditions, services and life opportunities of all city residents, particularly for disadvantaged communities.
So, Mr Ibrahim pointed out that within the country’s well-structured and decentralised local government system, property tax serves as the lifeline through which all MMDAs are supposed to leverage for internal delivery of services.
“This is in sync with Section 124 (3) of the Local Governance Act, 2016 (Act 936), which states ‘rates’ as one of the major sources of internal revenue for MMDAs.
It is worth noting that property taxation remains one of the most underutilised yet potentially powerful revenue tools to aid development in Africa”.
Despite its significance, it is constrained by systemic challenges, non-existent or outdated valuation rolls, fragmented property registers, weak enforcement systems, and low taxpayer confidence.
These limitations, according to the minister, are further worsened by tensions between central and local governments, in terms of unclear mandates, capacity deficits, technological bottlenecks, and political resistance.
Ghana is no exception to these myriad challenges. Like many of its neighbours, it has grappled with these complexities. However, as a ministry, they remain committed to addressing them head-on, he assured.
Recognising the gaps and the vision of government to strengthen local governance especially fiscal decentralisation, this workshop aims at advancing property tax reforms in Ghana as a strategy to boost domestic revenue mobilisation, reduce reliance on central government transfers, and promote sustainable, inclusive urban development, the importance of this workshop cannot be overemphasised.
“This workshop also ties in perfectly with the Resetting Agenda of government, which indicated that we shall abolish the centralised collection of property rates and provide technical support to MMDAs to enhance their revenue mobilisation capacities, including the collection of property rates”, the minister said.
Participants and dignitaries at the event
In a speech read for the Greater Accra Regional Minister, Linda Obenewaa Akweley Ocloo pledged support for the workshop and urged the MMDAs to leverage technology and digitisation in revenue mobilisation.
Nii Ahene Nunoo III, Paramount Chief of Abola and Ga Atofotse, who chaired the opening ceremony on behalf of the Ga Mantse, King Tackie Teiko Tsuru II, called on the government to speed up development in the local areas.
After the ceremony, facilitators and participants swung into action with the hope of learning best practices and gaining new knowledge in the area of property tax collection.
By Masahudu Ankiilu Kunateh, African Eye Report
