Land and Property Taxation to Finance Urban Development in Somaliland: Challenges and Prospects for Reform

Despite significant economic growth, particularly in the construction sector, Somaliland faces substantial public infrastructure deficits, which hinder further economic progress and increase business costs. Critical infrastructure needs and the low base of essential public goods provision highlight the need for the government to establish stronger fiscal foundations, particularly at the local level in urban areas. While government revenue collection is low, property and land taxes represent a significant opportunity to raise local government revenue and contribute to sustainable urban development.

This report examines land and property tax systems in Somaliland’s urban municipalities and focuses on the key challenges and reform opportunities to enhance revenue generation. Drawing on reform experiences from other sub-Saharan African cities, the analysis highlights strategies for effective property and land taxation in Somaliland. Emphasising the need for strong political commitment to achieve these reforms, it suggests a way forward for the implementation of progressive tax reform to finance critical urban development and set the foundations for the ambitions of the nation.