Local councils in Nigeria have traditionally been dependent on funds from federal allocations, which have
proved insufficient for effective urban governance and poverty alleviation. The 1976 local government
reform - meant to reverse the deteriorating state of affairs in grassroots governance, especially the weak
financial base – did not improve the situation significantly. Over 70 per cent of local revenue continues to
come from federal allocations rather than through viable local (particularly property) sources. The paper
examined the nature and causes of low yield from property taxes by means of case studies of the five local
councils in Ibadan Metropolis. Data was secured from the State Rating Valuation Office, valuation
departments of local councils, private sector valuers and ratepayers. The paper examined exemption
policy, basis of assessment, billing, collection, rate enforcement and other issues affecting property yield.
The results revealed a wide gap between revenue collected and generation capacity. The disparity was in
turn traced to factors such as omissions and inaccurate valuations in valuation lists, inadequate manpower
at the local councils, absence of enforcement machinery and lack of political will. The paper advocated a
wide-ranging reform of the property tax structure and laws as well as the adoption of GIS.