Property Taxes Operate As Foundation For Resilient Municipal Development - HSE Representative

(MENAFN- Trend News Agency) BAKU, Azerbaijan, May 21. Real estate taxation functions as the primary financial foundation for the resilient development of municipalities and the sustained underwriting of critical urban infrastructure pipelines, said Irina Ilina, representative of the HSE University (National Research University Higher School of Economics), Trend reports.

The academic made the remarks during a panel discussion titled "Fair Property Taxation as a Driver of Sustainable Urban Development," held within the framework of the 13th session of the World Urban Forum (WUF13) in Baku.

According to her, the structural configuration of a property tax system exerts a direct, unyielding impact on the aggregate quality of the municipal environment and baseline indicators of social equality. "If property taxes undergo collection via a flat, uniform rate that fails to account for the physical quality and geographic location of the housing stock, it can trigger severe socioeconomic disparities across communities," Ilina pointed out.

She emphasized that asset-based taxes represent one of the most vital revenue pipelines for local authorities, directly enabling the physical expansion and modernization of cities and municipal settlements.

"Without robust property tax streams, local governance structures cannot construct roads, schools, universities, medical centers, and other essential infrastructure assets. These fiscal resources directly secure the continuous existence and maintenance of vital public goods," the HSE representative stated.

Ilina cited the Russian real estate taxation architecture as an active operational example, noting that the country utilizes a multi-tiered fiscal model wherein property taxes undergo statutory classification strictly as local municipal levies.

According to her, the Russian property tax framework comprehensively integrates three distinct core pillars: the land tax, the property tax on physical individuals, and the corporate property tax on commercial organizations. She concurrently reported that the national tax code undergoes continuous regulatory refinement, with active tax rate calculations pegged directly to the official cadastral (assessed) value of the real estate asset.

"In strict compliance with statutory legislation, the cadastral valuation of real estate assets undergoes systematic re-evaluation every four years. However, across the largest metropolitan economies, such as Moscow and St. Petersburg, this calibration cycle accelerates to once every two years to accurately reflect shifting market realities," Ilina concluded.

Today marks the fifth day of WUF13 in Baku.

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