||As part of their applications to join the European Union, ten central European countries are required to meet certain criteria, including stability of institutions, rule of law, democracy, a functioning market economy and the ability to adhere to the aims of political, economic and monetary union. Over the past 18 years, since the change from a central economy, there is evidence that these countries have sought (by varying degrees) to develop a range of local government functions supported by local finance, in many cases, including a range of real estate-based taxes. In the absence of a fully functioning property market, it has not been possible to base the taxing of real estate open market values. Instead, either an area or formulaic basis, or more recently on a modified area basis, which seeks to reflect relative “values” within different geographical zones has been developed. Thus, there is evidence of a growing shift towards value-based locational factors within the tax bases developed in some of the countries, but there is also evidence of resistance to such a move. There are political as well as practical reasons for at least being cautious about introducing a totally market-based local tax. Until the emergence of a fully-functioning property market for all taxable property types within the jurisdiction, there will be a paucity of suitable evidence for achieving an ad valorem property tax base in every case. There may be an opportunity to run two systems (value-based in cities and area-based in rural areas) in some cases, but there are also arguments for not having an ad valorem tax base at all, with other countries demonstrating how non-market value bases systems can achieve both tax payer and tax spender approval. This paper will explore the drivers and barriers to a market value-based real estate tax system in central and eastern European countries, based on their development of democratic institutions (particularly local government and their functions), their strategies for developing a local property tax, the level of funding involved, the approach within their existing tax systems for dealing with social and environmental issues and how the wider arguments for and against a value-based tax are being reflected.