Lagos Govt Bows to Pressure, Slashes Land Use Charge

• Gives tax credit for payments already made

• Introduces instalmental payment plan

Gboyega Akinsanmi

After the sustained campaigns against the state’s new Land Use Charge (LUC) by different interest groups, the Lagos State Government thursday eventually succumbed to pressure, announcing a review of the charges payable by all property owners across the state.

Specifically, the state government reduced the commercial charge by 50 per cent; properties occupied by owners and third parties in the same premises used for manufacturing purposes, and properties used for industrial and manufacturing purposes by 25 per cent; and owner-occupier properties by 15 per cent.

The state government equally introduced an instalmental payment plan for property owners across all categories, and completely waived penalties for late payments of the LUC, thereby providing additional relief to property owners.

The Commissioner for Finance, Mr. Akinyemi Ashade reeled out the concession on the Land Use Charge Law at a news conference at the Bagauda Kaltho Press Centre, Alausa, saying the exercise was received with mixed feelings by various interest groups who expressed serious concerns.

Ashade addressed the news conference alongside the Commissioner for Information and Strategy, Mr. Kehinde Bamigbetan, the Attorney General and Commissioner for Justice, Mr. Adeniji Kazeem, and the Commissioner for Waterfront Infrastructure Development, Dr. Babatunde Adejare, among others.

Ashade noted that the state government reviewed the LUC payable by all property owners across the state in its desire “to build world-class infrastructure and improve the well-being of its citizens”.

He added that the state government made the concession in line with Governor Akinwunmi Ambode’s tradition of inclusive governance and civic engagement, noting that the government was committed to the welfare of its citizens and understands the importance of continuous engagement with the populace.

The commissioner said: “We undertook extensive dialogue with various stakeholders on the Land Use Charge revised Law and its implementation.

“Consequently, we received a wide range of responses from our dialogue with various stakeholders on the amended Land Use Charge Law, 2018.”

He explained that the various interactions formed the subject of extensive deliberations at the meeting of the Lagos State Executive Council on March 14.

“The Lagos State Executive Council chaired by Governor Akinwunmi Ambode resolved to make some concessions in line with stakeholders’ demands,” he added.

He said commercial property owners, who were undoubtedly the stakeholders most impacted by this amended law will be granted a 50 per cent discount, explaining that a commercial property valued at say N20 million, which was earlier billed N91,200, would now pay N45,600 per annum.

He also explained that properties occupied by the owner and third parties in the same premises but used for industrial and manufacturing purposes will now enjoy a 25 per cent discount.

“This means that a N20 million property expected to pay N30,720 will now pay N23, 040 per annum.”

He added that owner-occupier property will get a 15 per cent discount, “so for a N20 million property, this used to be N9,120. Now, it is N7,752 per annum”.

Aside from the reduction across all categories, Ashade disclosed that the state government waived the penalties for late payments of the LUC, noting that property owners, who have received their bills, would no longer be penalised for late payments issued in 2018.

He said the removal of the penalties would provide additional relief to all property owners, noting that other rates and reliefs, apart from the ones stated above, will remain unchanged and will be implemented as stipulated by the law.

“The rates and reliefs include 40 per cent general relief, 10 per cent for 70 years and above, 10 per cent for properties owned by persons living with disability, and 10 per cent for properties that are 25 years old, and so on and so forth.

“Owners of properties across all categories will now be allowed to make payments in instalments. This will help to reduce the burden of taxation on our citizens,” he said.

He commended property owners in all categories who had performed their civic duties faithfully by paying the LUC, assuring those who had paid before the downward review that they would be awarded tax credits to the extent of the excess amount paid and carried forward to next year.

In his remarks, the state attorney general said the State Executive Council “shall forward to the Lagos State House of Assembly for review and passage the following regulations: a review of applicable rates and the regime of reliefs on categories of properties pursuant to the Land Use Charge Law, and regulation for a framework for self-assessment”.

He implored all stakeholders to participate effectively in the legislative proceedings and conveyed his appreciation to them for trusting the current administration with the responsibility of investing the revenue from the LUC in infrastructure renewal and overall development of the state.

Kazeem said under the amended law, there is a provision for establishment of five tribunals, of which one has been established in Ikeja and is now operational, adding that the remaining four would be established in other administrative divisions of the state in Epe, Badagry, Ikorodu and Lagos Island.

He said the law also makes provisions for aggrieved taxpayers to ventilate their grievances within 45 days through a mediation process, adding that so far over 80 cases had been resolved through mediation.

Lauding the review, the Executive Director of Centre for Public Accountability (CPA), Mr. Femi Lawson, thanked the administration for its empathy with the people of the state.

“This review shows a government that shares in the pain and concerns of the citizens of this state. Not only did they listen to our agitations but also the Lagos government took action to allay our fears and worries by bringing the LUC rates down and introducing some other tax relief measures. This is surely a pro-people’s government,” he said.

Similarly, Mr. Thomas Aderinola, a real estate investor in Lagos, said the downward review of the amended LUC Law was a reassuring indication that state government listens to its citizens.