Modular, Mobile, and Digital: Rethinking Property Tax Systems for Lower-Income Countries

This blog is based on Schenker and Prichard (2024) »Key Elements of IT System Design for Property Taxation. »

In lower-income countries, adopting well-designed digital/IT systems can dramatically improve the efficiency and fairness of property tax administration. This blog explores the essential functional and non-functional building blocks of effective property tax digital systems, including GIS integration, mobile data collection, modular architecture, and interoperability. It also highlights the importance of local context, user training, and change management in ensuring successful implementation. Whether upgrading an existing system or building one from scratch, this piece offers a practical guide to designing technology that works for researchers, practitioners, and institutions alike.

Understanding the Administrative Workflow and Key Functional Requirements

A well-designed digital property tax system must reflect the system’s end-to-end administrative workflow. This process typically involves seven core functional requirements, each of which will be explored in turn.

1. Identifying taxable properties
2. Assessing property values
3. Setting applicable tax rates
4. Calculating tax liabilities
5. Generating and delivering tax bills
6. Tracking and collecting payments
7. Supporting essential administrative tasks

Property Mapping

Good quality, reliable property maps are the foundation of any effective property tax system. GIS data is a foundational approach that enables jurisdictions to create a spatial digital property register. This is achieved by identifying properties, drawing rooflines for clearer identification purposes, and providing navigation to properties through an address system for property valuation, bill delivery and enforcement.

As such, an effective digital system should integrate GIS functionalities with georeferenced addresses, whereby the use of high-quality aerial imagery to verify collected information can be very useful.

Property Valuation (Assessment)  

Once properties have been mapped, they must be valued. One of the main advantages of using a digital property tax system is that calculating property values and tax liabilities can all be automated. Valuation methods must be customizable to the jurisdiction’s needs and resources. Common approaches include:

• Expert Valuation: experts assess and upload property values to inform the calculated value of properties.
• Automated Valuation Models (AVM): key property characteristics are uploaded to the system which then automatically calculates taxable values based on a pre-defined formula. This approach can reduce the costs associated with property valuation while enhancing transparency by maintaining a clear record of property characteristics and the approach to valuation.
• Self-Assessment: taxpayers self-assess estimated property values or other property information that is then used to automatically calculate property values.

Ideally, valuation modules should be configurable to allow for updates in property values and methodologies, ensuring relevance over time.

Rate Setting

After properties have been assessed, the tax authority will apply a tax rate to determine the value of the bill distributed to taxpayers. The system should be flexible enough to accommodate alternative tax rate setting approaches and respond effectively to changes in policy or revenue needs. The calculation of tax liabilities based on tax rates attributed should be automized to increase efficiency.

Billing

Once tax liabilities have been automatically calculated, bills need to be generated and delivered to taxpayers to begin collecting revenue. To reduce logistical complexity and facilitate delivery, the IT system should enable the creation of large batches of bills (bulk production) and automatically assign them to corresponding property records.

Payments

Beyond billing, an effective IT system should also include a payments module that integrates directly with payment service providers (e.g., banks, mobile money, online banking), records payments in taxpayer accounts, tracks revenue inflows, includes payment deadlines and relevant penalties, and provides proof of payment. Integrated payment methods ensure automated reconciliation of payments and increase transparency and taxpayers’ trust in the revenue collection process.

Supporting Administrative Tasks

In addition to the core functional requirements, designers should also integrate the following supporting administrative tasks to ensure the system is as responsive and dynamic as possible.

• Audit Logs

When adopting automated systems, an audit log can help facilitate monitoring and transparency by tracing and recording significant actions to specific users. These actions include transactions that impact revenue, any adjustments made to property information or value assessments, and the adjustment, addition or removal of payment records. However, to be effective, audit logs rely on unique and secure logins for every user interacting with the system.

• Reports

To enhance the accountability and transparency of the tax administration, the IT system should generate various forms of reports. These reports can include recording all properties eligible for taxation, financial reports to monitor revenue collection progress, defaulter reports to identify defaulters and ensure compliance, delivery reports to monitor bill delivery, and audit reports. Allowing some flexibility to generate and download custom reports may be beneficial when a more detailed analysis is necessary.

• Document Storage

The system should have sufficient storage space to store tax-relevant documents (e.g., receipts, assessment appeals, past bills). These systems should have the option to download documents, a particularly cost-effective measure when long-term document retention is required. Due to the sensitivity of this data, security should be prioritized when selecting storage options.

• Integrated Mobile Apps for Discovery and Deliver

Mobile apps are increasingly central to effective digital property tax administration, improving accuracy, efficiency, and transparency compared to manual methods. They reduce the scope for errors, streamline workflows and allow supplemental data (e.g., GPS) to be integrated into property records. Mobile systems are most useful when they are available offline, especially in low-connectivity settings.

When fully integrated with the broader IT system, native apps deliver the strongest benefits, as they allow for seamless communication between the core IT system and its native mobile application. Where resources for native mobile development are limited, third-party tools (e.g., SurveyCTO, GIS platforms) can deliver insofar as administrations are able to ensure data migration, security and compatibility with the core system through configurability while shouldering the risks of relying on an external provider. Nevertheless, enhanced security, automated validation, user-friendly interfaces, and real-time updates where possible should be prioritized when developing any effective app.

Especially in lower-resource contexts, apps should be designed for simple devices, ensuring low processing demands, operating system flexibility, and extended battery life. Core mobile apps should at a minimum include online/offline use, unique logins, selective data assignment, mapping features and photo capture.

Function-specific apps can further improve the administrative process. For example, discovery apps allow comprehensive data collection, preloading of existing records, addition of new properties and metadata verification. Similarly, delivery apps can support reliable bill distribution by preloading assignments, enabling navigation, recording delivery details, and logging unsuccessful attempts, all while collecting metadata (e.g., GPS location, time, and recipient signatures) for verification.

Finally, citizen portals extend transparency, trust and engagement by providing taxpayers with digital access to bills, payments, appeals, and tax registers through their verified accounts. The breadth of functionality in a portal is contingent on available resources, with costs growing as complexity is added. Building a portal from scratch and as a core component of the overall system design creates long-term value, enabling more efficient interaction between taxpayers and authorities, yielding stronger compliance. 

Key Non-Functional Elements

Non-functional elements, which support the main functional features of the system, are also crucial to ensure successful adoption and sustainability in particular contexts.  What follows summarizes some of the key considerations and options, with a focus on the needs of lower-income countries.

Simple User Interface and User Experience

A straightforward, intuitive user interface is crucial for ensuring usability, especially when digital literacy is limited. Systems should present information clearly, organize workflows into logical, task-specific segments and seek to minimize unnecessary information and complexity.

Platform Choices: Off-the-Shelf, Open-Source, or Open Platform

Digital and IT system reforms often begin by selecting between available approaches to system provision:

• Off-the-Shelf: pre-existing systems that are immediately available and quick to deploy. However, they may come with recurrent licence or hosting fees, limited flexibility and configurability, and may foster dependence on external developers.
• Open-Source: free access to source code based on common programming languages. These systems maximize flexibility but come with longer development timelines, higher costs, and may require advanced skills to install and maintain.
• Open-Platform: a middle-ground option where source code is controlled by the provider, but in which systems are designed to enable independent programmers to build extensions to the core system, providing pathways for governments to maximize configurability and flexibility, attenuating vendor lock-in.

Administrators should select the approach that best suits their needs and the local context, with particular attention to the need for long-term flexibility and sustainability.

Modularity

As system requirements evolve over time, ensuring modularity can help administration anticipate and adapt these changes. A modular system separates functionalities (e.g. GIS, payments portal, etc.) into independent, interchangeable components that execute a specific function. This design enables easy scaling and testing to improve individual modules, facilitates the expansion of the system to cover new functions, and makes it possible to alter or replace individual modules, thus maximizing adaptability and flexibility over time.

Interoperability

Interoperability compliments modularity and ensures the system can communicate with external platforms (e.g., payment processors, government databases), facilitating seamless data exchange and improving overall system efficiency.

Configurability

Configurability allows clients to make simple adjustments to key functionalities, allowing users to fine-tune the system and respond to changes without needing external developers. Alongside modularity and interoperability, configurability improves system adaptability and fosters a sense of autonomy for the tax authority by facilitating local adjustments.

Scalability

Similarly, scalable systems can help administrators meet changing demands when workloads increase (or decrease) by ensuring:

• Internal Scalability: supporting increases in records, users, and transactions.
• External Scalability: using the same system across various locations simultaneously.

On-Site versus Cloud Server Hosting

Tax authorities also need to consider where to host their software. On-site hosting involves maintaining a physical infrastructure on location. Administrators retain direct control over data and infrastructure, but they often face significant upfront, maintenance, and security costs and the infrastructure requires to be replaced after its life cycle expires. Meanwhile, cloud hosting operates on external servers accessed via the internet, offering lower operational costs, scalability, and quick updates for a recurring fee, with security measures being implemented by the cloud provider. As with on-site hosting, cloud hosting also allows data ownership retention. The choice ultimately hinges on three main factors: costs (upfront vs. recurring), scalability (limited vs. flexible), and security (local sovereignty vs. trusted provider safeguards).

DTAP Process – Development, Testing, Acceptance and Production

Once these factors have all been considered, a structured DTAP process ensures the system meets client needs and workflows before going live. Development and testing are developer-led, while acceptance and production involve the client. In acceptance, clients review the system on a staging server before approving live deployment. Staging access offers two added benefits: it allows safe experimentation with configurations before deploying them in production, and provides a training space where users can practice without risking real data, reducing deployment risks and building user confidence. Furthermore, DTAP can be seen as an indication of professional development of IT systems.

Conclusion

Effective property tax administration is fundamental for strengthening local revenue systems, particularly in lower-income countries where administrative capacity and resources are often limited. Thoughtfully designed systems can be pivotal in making property taxation more efficient, transparent, and user-friendly for administrators and taxpayers.

However, as is often repeated, technology alone is not a panacea. The success of any system ultimately depends on its alignment with local needs, capabilities, and institutional realities. This requires not just good software design, but also investments in user training, building institutional ownership and capacity, and managing change effectively to navigate potential resistance.

Tax authorities can significantly enhance the sustainability and impact of property tax reforms by grounding system design within the local context and coupling technological solutions with thoughtful implementation. The result? Better technology and more resilient systems of local governance and revenue generation.