Association says current rate of 20% is already high compared to neighboring countries, and the increase will overburden locals
By The City Review
The South Sudan Real Estate Association has warned that the proposed increase in the withholding tax on rental income and service charges from 20% to 30% could deter investors from the local market, exacerbate unemployment, and open the door to illegal practices.
During a public hearing on the 2025/2026 Finance Bill on February 12, the association’s representative, Mathiang Paul Mium, urged the Ministry of Finance to reconsider the proposal, emphasizing that the current rate of 20% is already high compared to neighboring countries. He pointed out that the rental tax rate in Kenya is 7.5%, while in Uganda it reaches 12%, making the local market less competitive regionally.
Mium, who represents an advocacy body comprising 56 registered companies, explained that maintaining competitiveness requires reducing the tax to 10% instead of increasing it, arguing that raising it would send a negative message to investors and encourage them to move their investments abroad.
He also raised concerns about what he called the “cumulative tax burden,” noting that property owners already pay multiple fees at the national, state, and municipal levels, including local council fees, municipal services, building permits, and land administration fees, in addition to capital gains taxes. He pointed out that the new proposal could lead to double taxation by imposing withholding on service payments that are already subject to capital gains tax, and called for limiting the tax to rental income only.
The association emphasized that the real estate sector constitutes at least 30% of the GDP, while related services contribute 27% of employment, and the construction sector employs approximately 13.7% of total jobs, making it a key driver of the national economy.
Mium warned that imposing tax increases amidst high unemployment and declining occupancy rates—resulting from reduced demand from international organizations—could be counterproductive, including the growth of informal practices and the loss of anticipated revenue. He concluded by calling for the adoption of tax policies that incentivize investment, stressing that easing the tax burden will contribute to encouraging real estate development, expanding job opportunities, and strengthening the country’s infrastructure.
Utilities
South Sudan Real Estate Association says country’s rental tax is highest in the region, atop neighbours Kenya (7.5%) and Uganda (12%).