Abstract:
Every government in the world is required to increase the public coffers through the imposition of
mandatory fees on individuals and corporations in the form of taxes. Real estate taxes are one of
the methods used by the local government to raise money. An efficient system of real property
taxation is crucial for a sustainable economy to establish a foundation for the decentralization of
public governance and to collect property value for local governments. Real property taxes, the
tax on land and building, have evolved along with the effective land tenure systems that come with
privately owned land. In Ethiopia the FDRE Constitution and regional constitutions do not
recognize the notion of real property tax or property tax in general. On the other hand, there is
the system of collection of tax on building/house in Oromia regional cities in the form of roof and
wall.
So, the very purpose of this thesis was to examine the real property tax in Oromia regional state
urban centers. The thesis was conducted with mixed type of research and both primary and
secondary data sources were extensively used. To this end, the cities in the region has been selected
based on their standards and also the convenience sampling has been applied. Real property taxes,
in particular the tax on buildings, have been serving as a sources of income for cities in the Oromia
regional state. The real property tax, however, is governed by the rules that govern the general
revenue of the city and is not specifically outlined in any comprehensive statute.
The current state of affairs demonstrates that the region's real property tax administration system
is insufficient for both the purposes of taxation and the fundamental principles of taxation.
Therefore, the current regulations governing the tax on buildings, which appear to be a fee, should
be reorganized, and the taxes on real property and general property should be included under
distinct laws based on the fundamental tenets of taxation and the nation's taxation policy
