We investigate spatial dependence of per capita property tax income among South African municipalities. One original contribution of our
study is the use of per capita property tax income, rather than the property tax rate, as the outcome variable. Per capita property tax income
is indicative of tax burden on residents. In addition, whilst most studies focus on advanced countries that have had institutionalised Öscal decentralisation for many decades, this paper focuses on South Africa, which is a developing country and implemented Öscal decentralisation only 18 years ago. Using Bayesian spatial econometric approach, we establish the presence of spatial dependence.