DIFFERENCE BETWEEN LAND RENT AND LAND RATE
Before we dive into understanding these analogies, we must first define what Land is.
It is basically the solid surface of the Earth that is not permanently covered by water.
It makes up 29.2% of Earth’s surface and includes all continents and islands.
LAND RENT
Land Rent is a levy imposed on leasehold parcels of land where the annual rent has been reserved at the time the grant is being issued, and it’s payable to the Ministry of Lands and Physical Planning.
In simple terms, it refers to the rent paid for the use of land, so basically, if you are residing in that area, it is the payment made by a tenant to a landlord for the use of land.
The concept of land rent is based on the idea that land is a scarce resource and that its value is determined by supply and demand.
What determines the amount of land rent paid is the location and quality of the land, as well as the demand for it.
LAND RATE
Owning a piece of land can be exciting.
As good as it looks, it is also important to maintain it, or rather, make your stay on it easier and more comfortable.
The best way to do this is by paying land rates, as you will be paying for the services that you will be receiving from the county in coordination with the government.
The land rate is a tax levy that is paid to the Kenya Revenue Authority (KRA) at regular intervals.
These are basically taxes levied on land based on its current market value.
The Value of the land increases gradually as it gets serviced by social amenities such as water, sewage systems, streetlights, improved roadways, and on and on.
And always remember, it’s based on valuation, as these figures aren’t constant; they always change.
READ:5 TYPES OF LAND TAX
