3.44 Use RLeal Estate AageL- Informa to to Value Land. In valuing land-including the land under buildings--taxing authorities have no alternative but to seek evidence from the property market. In capital value countries, one might expect to find credible property market data reported in the legal documentation accompanying transfer of ownership--the contract or the deed of sale. Since government is the repository of deeds of sale, this might be thought to be easily accessible.

3.45 Developing countries' property tax regulations often reflect this assumption. In Brazil, the state agency responsible for administering a tax on property taxation as well as government-licensed registrars of deeds are required to inform the valuer of all recent transactions. In the Philippines, the same obligation is imposed on deeds registrars, and on both parties to the transaction.

3.46 But official cLata is unreliable. With startling uniformity, developing countries impose high taxes on real estate transactions. This prompts transactors to grossly understate actual prices in official documentation. In practice, therefore, taxing authorities tend not to rely on official sources. Instead they constitute valuation commissions, consisting of real estate agents and major property owners, who come up with market information based on their professional experience.

3.47 The process for converting individual observations into a standardized table parallels the one used in estimating the unit cost of buildings--with the same problems. It starts with a systematic ordering of data but then is overloaded with arbitrary adjustment factors. First, estimates of the market price of specific parcels in various locations in the jurisdiction are made. These are grouped by neighborhood and divided by their respective dimensions, yielding an estimate of the unit value of land by neighborhood. A variety of adjustment factors are then imposed. In Brazil, unit costs are adjusted to reflect the availability of specific public services and the steepness and squareness of the plot's layout. Similar adjustment factors are used in the Philippines. Again, there is no evidence that the value attached to these adjustment factors is based on the analysis of market conditions.

3.48 While mass appraisal is most common in capital values countries, it is also used in ARV countries, particularlv in the valuation of owner-occupied property. Like the procedure used in capital value countries, the process begins with a survey of properties. Individual observations of current rents are then grouped and analyzed to yield an estimate of prevailing rents, per unit of floor area, in various neighborhoods. The extent of further elaboration varies. In Karachi and Lahore, the unit cost tables simply designate a standard value per room, cross-classified by neighborhood. The tables used in Jordan, in contrast, define a rental value per square meter of floor area, cross classified by class of municipality, neighborhood quality, and quality of construction materials. The process used to derive these more detailed tables is, again, obscure, even to the valuers using them In Jordan, the most recent tables were developed by a committee set up for the purpose and since disbanded; Ahmedabad is still using a table of values established in the 1950s, based on deliberations long since forgotten.