Land hoarders face major hike in taxes

Dar es Salaam. The government is considering increasing tax on undeveloped land in a fresh bid to drive out hoarders and free the resource for wealth creation and poverty reduction.

Land, Housing and Human Settlements Development minister William Lukuvi revealed yesterday that the new measures would, however, include reducing the tax burden on investors who have put their plots to productive use.

He said the tighter tax rules were aimed at discouraging the tendency by some businesses and individuals to amass land simply for speculative purposes.

“We have been witnessing a tendency by some people to buy huge tracts of land which they don’t develop,” Mr Lukuvi told reporters in Dar es Salaam. “We want to discourage that because there are a lot of people who are looking for land for development purposes,” he said on the sidelines of an event to inaugurate the National Land Use Planning Commission (NLUPC) board.

Preparations for the implementation of the plan are underway, and the new tax regime on land could be effective by next July, the minister revealed.

This is not the first time the government has taken stern measures to curb the rampant hoarding of land.

In 2013, it raised rent from Sh200 per acre to Sh1,000 for rural land and Sh5,000 to Sh10,000 for the resource in urban areas. The ministry said it had been slow to ensure land is used for wealth creation and poverty eradication.

To curb land speculators, the government has also previously said it would repossess all unregistered plots from 50 acres and above. At various forums, experts have advised the government to ensure anyone applying for land already has plans for its use as a measure against speculation.

And addressing the NLUPC board yesterday, Mr Lukuvi asked the members to come up with recommendations on how best the government could finance sustainable land use across the country.

“Non-governmental organisations like Oxfam and Care International have been mobilising funds. How come such a well-organised body like the NLUPC is failing to do the same?”

The government recently rolled out a demarcation and surveying exercise across the country in a fresh bid to ensure proper utilisation of the resource in accordance with land use planning.

According to data made available by NULPC, the government needs about Sh2.3 trillion for the exercise that also includes the issuing of certificates of customary rights of occupancy (CCROs) to villagers in areas that have land use plans across the country.

Mr Lukuvi also asked the NLUPC to update its database to reflect the actual sizes of land one can possess instead of allowing the acquisition of large plots by individuals who in the end fail to use them.

“We need to have a database that shows us who owns how much land. From this we should be able to ascertain the percentage of land that has been put to productive use and that which is idle. This will help us when drafting land use plans,” he said.

The NLUPC has been given the next 10 years to conduct the exercise, which the government hopes could also curb bloody resource-based conflicts pitting pastoralists against farmers across the country.

Currently, only 1,645 out of 13,000 villages in the country have developed land use plans, according to data recently released by NLUPC.

Mr Lukuvi said the commission’s database should also help to determine the amount of livestock that can be accommodated in particular areas.

“What we currently have is a situation where some pastoralists try to squeeze huge numbers of cattle in small areas that cannot sustain proper livestock farming, that is why they have been moving all over the country,” he said.

Meanwhile, the minister said the government would upgrade the certificates of customary rights of occupancy to make them acceptable in the formal financial system. This will help farmers and other land owners to easily access bank loans.

He directed the NLUPC to make this process one of its priorities. NLUPC chairperson Fidelis Mutakyamilwa said his team would work with land stakeholders to deliver on its tasks.

“We will continue to work very closely with CSOs, NGOs and other members of the private sector to meet the government’s target of surveying up to 7,500 village land by 2020,” he said.