Only 45% of the property tax bill paid

Prishtina, March 3 – FOL Movement, today published the analytical report “Property tax in Kosovo municipalities.” In this report was analyzed the rate of the collection of property tax billed by Kosovo municipalities and the importance of this collection for municipalities financial sustainability.

Kenan Tora from FOL Movement said that “the report was compiled based on the data of collection of property tax billed, provided by municipalities upon the request in advance of FOL. The goal of this report is to present a real picture of collection of property tax billed by municipalities. “FOL sent the request to access these data to 34 municipalities, but only 26 of them provided the data and four other municipalities provided the data in a format which was not proper for analysis. Municipalities that did not respond to the request of FOL Movement for public documents access are : the Municipality of Prizren , Deqan , Klina , Lipjan , Shterpce , Kllokot , Mamusha and Partesh . FOL Movement filed a complaint at office of the Ombudsman for declining their request by these municipalities for public documents access. FOL will continue with other legal proceedings to realize the right of public documents access.

Kenan Tora also stated that “the property tax is one of the most important sources of municipalities own income, which are specified in Article 8 of the Law on Local Self-Government as financial resources that should be provided to municipalities for providing services to citizens. ” Based on the findings of the report , in the sense of rate, own income historically consisted about 17% of total municipal income every year. Regarding own income , property tax is the most important which consists about 30% of the income. Property tax billed represents about 4 % of the total budget of the municipalities that we analyzed in this report. Regarding the overview of the property tax bill, based on the data provided for 2012 by 22 municipalities, 80% of the invoiced value refers to property taxes for the respective year. The rest includes charging interest because of failing to pay the previous years’ taxes (15 % of the bill amount) and penalties for failing to pay the property tax within the due date for previous years (5 % of the bill amount) .

The analyzed data shows that 69.22% of the bill amount is collected. However, according to Kenan Tora “this overview may not be correct, since this collection includes all collections including the collections of old debts, penalties and interest.” After the analysis, we noted that only 52% of the amount collected has to do with the payment of property taxes during the current year (2012), while 48% of the payments collected by municipalities in terms of property tax payments is related to old debt (38%), payment of interest (7%) and penalties (3%).
Another problematic issue is that the property tax amount collected for the current year (2012) without penalties and interest is only 45% of the property tax bill for 2012, collected by analyzed municipalities. This represents a very important issue, as a collection rate below 50% of the property tax bill for a relevant year means the total debt on the property tax increases every year for over 50% of the bill amount.

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