A digital tool to improve property tax management in Senegal

Researchers from the Paris School of Economics initiated, in 2017, a partnership with the Directorate General of Taxes and Domains (DGID), which led in 2018, through a ministerial decree, to the creation of the Project for the Improvement of Property Tax Management (PAGCF). Institutionally anchored within the DGID, which operates under the authority of the Ministry of Finance and Budget, the project collaborates, in the implementation of its activities, with the Directorate General of Public Accounting and the Treasury (DGCPT), responsible for the collection of local taxes, as well as with several major programs such as the Support Project for Municipalities and Agglomerations of Senegal (PACASEN).

The project also benefits from technical and scientific support, notably from economists at the Paris School of Economics and Sciences Po, as well as financial backing from the FID, J-PAL, and the World Bank.

The team’s initial work revealed that property tax revenues in Dakar account for only 9% of their potential, due to significant structural constraints (an incomplete cadastral plan, the absence of a harmonized addressing system, limited administrative resources, and outdated recorded property values). This low percentage reflects both the difficulty of administering property tax and the major obstacle that such lost revenue represents for the development of Senegal’s capital city.

To address the shortcomings of an underperforming property tax collection system, the Paris School of Economics, in collaboration with Senegal’s Directorate General of Taxes and Domains (DGID), designed and implemented a new property tax management system in Dakar.

The major innovation lies in the establishment of a mechanism based on a new web and Android software application — a digital platform developed to centralize cadastral data, issue tax notices, and test new approaches to property valuation on an exploratory basis. The goal of this work is to identify methods that could ultimately improve the reliability and fairness of the tax base.

Thanks to this digital application, the administration is now able to conduct large-scale surveys, during which information about taxpayers and their real estate holdings is updated and the tax base is broadened. In parallel, the use of satellite data complements the system and helps estimate the fair value of properties in a reliable and unbiased manner. Geolocated tax notices are printed, which facilitates tax collection.

Tax surveys have already been carried out in nearly 80% of the neighborhoods targeted by the project (which covers 97 cadastral sections of the city of Dakar, encompassing more than 40,000 parcels).

Support from FID makes it possible to continue the program and to carry out an impact evaluation, which will specifically assess the tool’s effectiveness in terms of tax revenues and tax equity, as well as measure the effects of increased tax pressure on relationships between taxpayers and local and national institutions.

To scale up, the PAGCF will receive additional funding of 328 million CFA francs over three years as part of the FID’s “Transformation of Public Policies” call for projects. This new phase will include:

• Intensifying the training of Tax Service Center agents on the new software and processing 90,000 new census forms;
• Integrating an e-filing module;
• Adopting citywide property valuation methods that fully leverage the potential of satellite imagery. Different rollout scenarios will enable a smart and gradual implementation.

The objective is twofold: on the one hand, to strengthen tax collection capacity; and on the other, to build taxpayer trust through more transparent, fairer, and evidence-based practices.