Assessing taxpayers’ awareness on their right to appeal property tax assessment in the city of Mzuzu – Malawi

• Author: Kaude, P.
• DOI: https://doi.org/10.47348/AMTJ/V2/i1a7
• Published date: 28 March 2022
• Date: 28 March 2022
• Citation: (2022) 2 AMTJ 120
• Pages: 120-137

https://doi.org/10.47348/AMTJ/V2/i1a7 120

ASSESSING TAXPAYERS’ AWARENESS ON THEIR RIGHT TO

APPEAL PROPERTY TAX ASSESSMENT IN

THE CITY OF MZUZU – MALAWI

ÉVALUATION DE LA SENSIBILISATION DES

CONTRIBUABLES DE LEUR DROIT DE FAIRE APPEL DE

L’ÉVALUATION DE LA REDEVANCE FONCIÈRE DANS LA

VILLE DE MZUZU – MALAWI

AVALIAÇÃO DO CONHECIMENTO DOS CONTRIBUINTES

SOBRE O SEU DIREITO DE RECORRER DA AVALIAÇÃO DO

IMPOSTO PREDIAL NA CIDADE DE MZUZU – MALAWI

Prince Kaude*

JEL classif ication: H71, H80

ABSTRACT

Valuation inaccuracy when assessing properties for taxation purposes, which results

in taxpayers deciding to evade property taxes due to higher taxes influenced by

incorrect assessments, affects the economy of the country negatively. This research

evaluated how a lack of taxpayer awareness of their right to appeal on estimated

property taxes affect property tax compliance in Mzuzu City. Qualitative and

quantitative data were collected by administering questionnaires while the study

areas were selected based on their planning nature and different state in terms of the

income of the dw ellers. Taxpayers were selected random ly and the sample from study

areas was found by matching the total number of taxable properties in the area to

the appropr iate sample size. The study has conf irmed that the majority of ta xpayers

do not take any action if an assessment is incorrect due to a lack of knowledge of

tax appeals which often leads to tax evasion. Consequently, the government needs

to extensively educate taxpayers on tax appeals through, for example, radio and

television media.

Keywords: awareness, property tax, tax appeals, tax evasion, valuation

inaccuracy

RÉSUMÉ

L’économie du pays est négativement affectée par l’inexactitude de l’évaluation

fiscale des propriétés immobilières due à une mauvaise évaluation ce qui conduit les

contribuables à décider d’évader la taxe foncière en raison du taux d’impôts trop.

Cette recherche a évalué comment l’ignorance des contribuables de leur droit de faire

appel quant à l’estimat ion de la taxe foncière af fecte l’observation/paiement de la ta xe

foncière dans la ville de Mzuzu. Des données qualitatives et quantitatives ont été

recueillies à l’aide des questionnaires distribués tandis que les zones d’étude ont été

*Researcher: Compassion Kind Organisation: princekaude5@gmail.com.

(2022) 2 AMTJ 120

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ASSESSING TAXPAYERS’ AWARENESS ON THEIR RIGHT TO APPEAL PROPERTY

TAX ASSESSMENT IN MZUZU CITY – MALAWI 121

https://doi.org/10.47348/AMTJ/V2/i1a7

sélectionnées en fonction de l eur capacité de planifier ainsi que la dif férence du statut

salarial des h abitants. Les contr ibuables ont été sélectio nnés au hasard et l’échantillon

des zones d’étude a été trouvé en faisant correspondre le nombre total des propriétés

imposables dans la zone à la taille appropriée de l’échantillon. L’étude a confirmé

que la majorité d es contribuables ne pre nnent aucune mesure si l’évaluat ion est fausse

à cause de l’ignorance des recours fiscaux en appel ce qui entraine souvent l’évasion

fiscale. Par c onséquent, le gouverne ment doit intensivement éduqu er les contribuable s

à propos des recou rs fiscaux en appel pa r le biais par exemple de la radio et t élévision.

Mots-clés: sensibilisation , taxe foncière , recours fiscaux en appel , évasion

fiscale , l’inexactitude de l’évaluation

RESUMO

A avaliação in correcta de propried ades para efeitos de impostos, que resul ta na decisão

dos contribuintes de fugir ao pagamento do imposto predial devido a impostos mais

elevados resultantes de uma avaliação errada, afecta negativamente a economia

do país. Esta investigação avaliou como a falta de conhecimento por parte dos

contribuintes do seu direito de recurso sobre a estimativa do imposto predial a pagar

afecta o pagamento deste imposto na cidade de Mzuzu. Foram recolhidos dados

qualitativos e quantitativos através da administração de questionários, enquanto as

áreas de estudo foram seleccionadas com base na natureza do seu planeamento e

diferente estatuto em termos de rendimento dos habitantes. Os contribuintes foram

seleccionados aleatoriamente e a amostra das áreas de estudo foi encontrada fazendo

corresponder o número total de propriedades fiscais na área à dimensão apropriada

da amostra. O estudo confirmou que a maioria dos contribuintes não toma qualquer

medida se uma avaliação estiver errada devido a um desconhecimento do direito

a recurso da avaliação do imposto, o que frequentemente conduz à evasão fiscal.

Consequente mente, o governo nece ssita de educar amplame nte os contribuintes sobr e o

direito de recor rer das estimativas fi scais através, por exemplo, da rádi o e da televisão.

Palavras-chave: sensibilização, imposto predial, direito de recurso, evasão

fiscal, avaliação incorrecta

I INTRODUCTION

Property valuation variances and inaccuracies occur in the valuation

profession as no two valuers can arrive at the same conclusion of value

even if such assessments are conducted using the same comparable data

(Effiong, 2015). Valuation exercises are therefore largely subjective as

it relies on the individual valuer’s judgement (Olofulahan et al, 2016).

Properties may be overvalued or undervalued for tax purposes which

results in incorrect tax rate charges on properties (Nischke et al, 2017).

On certain occasions, this valuation variation puts taxpayers at risk

of paying more tax than they should. In these instances, taxpayers

need to be aware of their right to object to property tax so levied.

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