Nations of Eastern Africa

REXFORD A. AHENE [*] THE HISTORY OF land taxation in east Africa reveals a chronology of incremental adjustments to European settlements in the region since the beginning of the century. The process can be divided into two broad phases. The first phase was a period of increasing European homesteading induced by colonial economic aspirations, and its accompanying need to define policies for land resource management. The second phase began with the attainment of independence in the 1960s. For most African states, this was an era of budget deficits, as governments consistently spent much more that they were able to raise from domestic sources despite their high levels of taxation. [1] In addition to the common British colonial heritage shared by the countries included in this survey, a wide variety of obstacles has stymied the attempt to tax real property. First, pre-colonial East Africa was characterized by the complete absence of urban settlements; few areas in Africa had such complete dispersal of population. Cities such as Nairobi, Entebbe, Kampala, Lusaka, Blantyre, Harrare, and Dar es Salaam were started by European and Arab settlers. Second, African traditional ideas of property ownership are often obscured, and there are, in most rural areas, no clear distinctions between private and community land ownership. Normally, land boundaries are not surveyed and land tenure terms are not specified. Thus, within the indigenous land tenure framework, title registration was of little significance to the management of land resources. Land registration was also introduced, in large measure, by Europeans as the tenure system in urbanizing areas, but was sporadically enforced or largely ignored in the rural areas. Consequently, the rudimentary cadastral requirements for levying a tax on real property have evolved slowly in Africa, and the land tax experience is limited, for all practical purposes, to urban land and improvements. The relative importance of land value taxes as a source of public revenue is difficult to establish in Africa because only rough estimates exist for a few countries on an aggregate, nationwide basis. Furthermore, financial accounts of local governments are rarely available and, as illustrated in Appendix A, land-based taxes provide a very small percentage of central government revenue. John F. Due's 1963 observation is still valid: "African property taxation, except for the European areas in Kenya, is almost solely urban taxation; nowhere is African-owned farm land subject to significant tax." [2] Thus, although real property is one of the components of the tax base in most African countries, the taxation of land values is feasible only when a well-defined registration system can be made possible. In spite of these limitations, we will endeavor to review the significance of land taxation in Kenya, Tanzania, Uganda, Malawi, Zimbabwe, and Zambia. [3] I Background to Land Taxation in Colonial East Africa SOME FORM OF land taxation was already present in the Kingdom of Buganda before Britain took over effective administration beginning in 1900. The Buganda Kingdom started as a small nation comprising a few counties--namely Kyadondo, Busiro, and Mawokota in the 15th century. The ruling elite, headed by the kabaka (king) collected rent from all land-holding subjects of the Buganda Kingdom. This levy was an obligatory tax collected from each man who owned a homestead and was married. Thus, when the Uganda hut tax was introduced, it was clear that the concept of taxation was discernible to most Ugandans. As early as 1901, the hut tax was proposed as the only practical way to raise revenue from the African rural sector. Though some scholars believe this tax was introduced to induce Africans to work on European farms, in reality the hut and poll taxes were crude wealth taxes that also served as a proxy for property rating to rural areas. The 1901 Hut Tax Regulation imposed a tax of one rupee, payable in kind or labor, upon every native hut in British East Africa. …