fees of 7% on average. Evidence from developed countries shows that even modest transfer taxes are highly distortionary: A 1.1% land transfer tax in Toronto has been shown to lead to significant welfare losses (Dachis _et al._ 2012) and, if the decision of whether to own or rent is accounted for, was estimated to incur a deadweight loss of 79% of revenue (Han _et al._ 2022). In the UK, transaction taxes caused large distortions to volume, timing, and price of property transactions (Best & Kleven 2018) and negatively affected land markets and labor mobility (Hilber & Lyytikainen 2017; Eerola _et al._ 2021). While their net contribution to public revenue is thus often modest, transfer taxes push property transactions into informality and encourage corruption and under-reporting to a point where price data become meaningless, and registries deteriorate. Replacing them with equivalent recurrent land tax on a much larger base is easy technically and can increase revenue, welfare, efficiency, and transparency.

Satellite imagery allowed cost-effective generation of urban tax maps at scale in Italy (Casaburi & Troiano 2016) and, via national programs, in India (Awasthi _et al._ 2020), and Brazil (Christensen & Garfias 2020). Computer-assisted mass appraisal (CAMA) of residential property is now standard in most developed countries (Grover et al. 2017). In the Netherlands 2.8% of GDP is raised in property tax revenue by transparently valuing millions of properties annually in a way that is equitable, trusted and perceived as fair as assessed property values are available publicly (Kuiiper & Kaathman 2015).

While these techniques have been successfully applied to African cities (Ali _et al._ 2020b), African countries overwhelmingly use formulas (i.e., charges per property or area unit, possibly for different zones or bands) that are less tightly linked to market values and thus more regressive. They often also require valuation by a licensed valuer even for residential property (Franzsen & McCluskey 2017) despite this being slow, costly, often perceived to be fraud-prone and arbitrary. If land values increase quickly, the implied long revaluation cycles can be associated with significant revenue loss. Focusing scarce capacity on valuation of commercial real estate and using CAMA for frequent revaluation of residential property instead could increase fairness and yield simultaneously.

Even with a complete tax map and market-based valuations, exempting owner-occupied housing from land tax as practiced by many African countries, will significantly reduce property tax yield and force renters to subsidize owners in a regressive way. Although politically expedient, such an exemption is justified neither from an economic (Englund 2003) nor a social perspective and may undermine tax morale, especially if taxes finance local services that are equally consumed by owner-occupiers. Levels of collection-well below 10% in published studies from Africa- imply that, instead of increasing compliance (Slemrod _et al._ 2022) public disclosure of tax information and social recognition of top taxpayers in Africa significantly reduced compliance (Regan & Manwaring 2023), consistent with the notion that taxpayers overestimate compliance levels and, once learning the truth, stop complying to avoid being taken advantage of.

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