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An evaluation of property tax base in Nairobi city

Lucy M. Nyabwengi (Department of Architecture and Building Science, University of Nairobi, Nairobi, Kenya)
Owiti A K’Akumu (Department of Architecture and Building Science, University of Nairobi, Nairobi, Kenya)

Journal of Financial Management of Property and Construction

ISSN: 1366-4387

Article publication date: 6 August 2019

Issue publication date: 20 August 2019




This study aims to evaluate the property tax base under the local government property taxation in Nairobi City and its implication on revenue adequacy of the city. Nairobi has grown both in population and in physical extent resulting to increased demand for urban services. The city faces challenges of adequate infrastructure service provision against increasing demand. Property taxation if fully exploited can be a major source of city government revenue, which has been dwindling.


Literature review of property tax bases in the world and examination of best practices was done to highlight the inadequacies of property tax base administration in Nairobi. Primary data were gathered through interviews of officers in Nairobi City involved in the land rating process. Secondary data were obtained through documentary search and field survey of the study area.


The study established that Nairobi relies on a dual system of taxation, namely, site value rating and area rating. Tax is on vacant land only and excludes improvements. There are many legal exemptions and administrative exclusions from the tax base. The property tax registers do not include all the taxable properties and there is no regular updating of the tax registers. Nairobi relies on an outdated valuation roll whose values have no relation to the current market values.

Research limitations/implications

These factors have resulted to a narrow tax base, which affects the revenue potential of the city and its ability to adequately provide infrastructure services.


This is an original research, which relied mainly on primary data. To establish the property tax bases and the exempt properties in Nairobi, the researchers interviewed the officers at the Nairobi city land valuation and property management directorate using structured questionnaires. To address the third objective on whether the property tax base is complete and all-inclusive, the research relied on primary data. The research population was residential properties in Buruburu, Kilimani and Riruta areas of Nairobi city. The sample data on property details were collected from the Ministry of Land and Physical Planning (MLPP). The researchers then examined the records at the Nairobi City to evaluate whether the properties, which are registered at the MLPP, are charged land rates at the city level and at what amounts. This included properties under site value rating and area rating.



Nyabwengi, L.M. and K’Akumu, O.A. (2019), "An evaluation of property tax base in Nairobi city", Journal of Financial Management of Property and Construction, Vol. 24 No. 2, pp. 184-199.



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