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Developing quality training approaches for effective property tax administration

This project focuses on enhancing property tax administration through quality training approaches in EU countries, aiming to address fiscal challenges and leverage real estate taxes. It investigates valuation standards, education for valuers, and offers a flexible e-learning course for professionals in the field.

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Developing quality training approaches for effective property tax administration

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  1. Developing quality training approaches for effective property tax administration Richard Grover Professor Ion Anghel Virgil Pamfil ERES-ESSEC Education Seminar, Paris, December 2007

  2. The Project Developing quality training approaches for effective property tax administration Funding: European Union Leonardo da Vinci Community action programme on vocational training by Agentia Nationala Leonardo da Vinci of Romania Lead partner: Centrul Regional de Formare Continua Pentru Administratia Publica Locala of Bucharest (CRFB) - project manager Virgil Pamfil Other partners: ANEVAR (Romania), the Technical University of Bucharest (Romania), CVT Georgiki Anaptixi (Greece), the University of West Hungary (Hungary), and Oxford Brookes University (UK)

  3. The Project Countries • Greece, Hungary, Romania, UK – all members of the EU, therefore: • Functioning market economies • Rule of law and security of property rights • Administrative infrastructure capable of supporting EU membership eg payment of agricultural support • 2 from “old” EU (Greece, UK) and 2 New Member States (Hungary, Romania) – contrast between transitional and other economies • Recent introduction of property tax changes in Greece, Hungary and Romania contrasts with established system in UK

  4. Fiscal Problems of Transitional Economies • Important changes in the tax systems to reflect changing role of state in society • Loss of control by state over captive revenue source from state-owned enterprises • Industries exposed to international competition so falling revenue from turnover taxes • Need for changes in tax system – to more reliance on other taxes eg income tax, social security contributions and consumption taxes

  5. Attractions of real estate taxes • Immobile nature of real estate makes taxes difficult to avoid • Difficulties from relying on company taxes and taxes on entrepreneurs because of tax competition between countries and highly mobile companies and entrepreneurs • Suitable tax base for local authorities • Historically little tax revenue from real estate taxes in transitional economies – an untapped potential fiscal resource

  6. Justification of market value real estate taxes • Reflects ability to pay by taxpayers – those taxed have income from rents and wealth • Equitable between taxpayers as those with similar wealth or rental income pay similar proportions • Buoyancy as revenues rise with rental and value growth

  7. Constraints on real estate taxes • Past history of collectivisation of land ownership and subsidised housing • Little role for real estate taxes in a centrally planned economy as limitedprivate ownership of land • Many inhabitants now occupy dwellings whose value is out of line with their incomes because of privatisation and restitution • Weak infrastructure of real estate markets

  8. Preconditions for the development of market value real estate taxes • The existence of an adequate quantity of qualified valuers • The ability to create and maintain a fiscal cadastre. • Valuation standards • Data on market prices being available to those carrying out tax valuations. • The absence of corruption and abuse of office amongst tax officers.

  9. Are their sufficient valuers? • Romania • ANEVAR established 1992, • members 6,800 members in which around 2,800 real estate valuers; • Hungary: • Magyar Ingatlanszövetség, the Hungarian Real Estate Association (MAISZ) • 550 members, including 110 individuals and 330 valuation companies. • The number of qualified valuers – insufficientto support a fully functioning real estate tax system based onmarket values.

  10. Preparation for programme Research into the four countries: • Real estate tax systems • Valuation standards used • Qualifications of and education and training of valuers • Codes of ethics for valuers • Measurement standards for property • Valuation methods used

  11. Features of the course • Targets those working in or responsible for real estate taxes and their assessment • Assumes already have non-cognate higher education (or equivalent) and are going through a conversion process • Flexible learning so it can be taken part-time whilst in employment • E-learning base so can be delivered anywhere anytime to students who can set their own pace • Equivalent to postgraduate certificate or adaptation test • Moodle environment to take advantage of facilities this offers tutors and students

  12. 8 plus 1 Modules • Definitions and types of real estate • Valuation concepts and principles • Influence of location on value • Measurement of buildings and land • Valuation methods • Mass appraisal methods • International practice in mass appraisal • Comparative real estate taxes • PLUS Training the Trainers

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