• Saturday, December 09, 2023
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LASAA, taxes force businesses to operate under cover


Many businesses in Lagos State, especially in the SME sector, now operate without signage identifying them or indicating what they do, for fear of exhorbitant signage charges by the Lagos State Signage and Advertising Agency (LASAA).

This underground operation by many businesses could be noticed from Ikeja, to Magodo, Ogudu, Ojodu, Festac, Yaba and Surulere, where many businesses are without signs.

Analysts attribute this to the fear of the Lagos State Signage and Advertisement Agency, (LASAA) which levies them with what they describe as ‘exorbitant’ charges on signage at their business premises.

The LASAA rates for wall and roof signs which are up to one square meter are N26,400 for high streets, N17,280 for signs at restrictive areas per annum, while normal areas attract N10,560. Signs that are upto five square meters attract N40,800 per annum in high streets, N26,880 in restrictive areas and N16,320 in normal areas. Signages up to 13 square meters attract N20,160 in rural areas, N40,320 in normal areas, N67,680 in restrictive areas and N100,800 in high street.

Non-display of such signage by some operators in the SME sector is due to fear and misunderstanding of LASAA operations, according to Fayo Williams, a pharmacist, told BusinessDay. “The way the LASAA calculates their square meter on those signages and the imposition of fines is confusing” she said, adding that LASAA fee calculation and procedure need to be simplified.

Placement of signage at business premises is a promotional strategy and a ready marketing tool employed to attract customers. The growing non-display of signage according to Williams, does have adverse implications on business growth and consequently on employment opportunities.

Rotimi Idowu, a large format printer based in Lagos said some businesses have since removed their signages while many others operate without signage for fear of the LASAA charges. Bolaji Finnih CEO of RightClick, an IT firm, also believes that the fear of LASAA taxes is the major reason why some organisations operate without signage.

Finnih however cautioned that the development will erode brand recognition and visibility. It will also bring to fore, questions on the credibility of organisations operating without any visible identifying signage ,as well as the actual sizes of such businesses.

Segun Aluko, a media agency operator, said the outrageous tax rates by various government officials make it difficult for some organisations to mount signages, stating that that charges are extra cost on SME firms who are already operating under severe economic conditions.

“At a point I had to remove the signage in front of my office because the charges were becoming unbearable,” he said.

According to Aluko, operating without signages makes it difficulty for customers to locate office premises and has negative effect on employment generation because if businesses are not located, they could lose business which would in turn have negative impact on employment.

He was particularly worried about taxes on branded vehicles across some states. “I pay tax for branding my vehicle in Lagos and if the vehicle gets to Oyo or any other state, they demand for tax also. At the end I will end up paying heavily on the same vehicle,” he pointed out ,adding that state governments should come together to harmonise branded vehicle taxes.