The Lagos State Government has given in to pressure to adjust its newly enacted Land Use Charge (LUC) law, as it cuts charges applicable to commercial properties in the state by 50 percent.
The state government also slashed rates on properties occupied by owner/third party as well as those used for industrial/manufacturing purposes by 25 percent, while properties categorised as owner-occupier have had their rate cut by 15 percent.
The resolution on the new rate regime was reached after an extensive state executive council meeting, Wednesday, which officials say took into cognisance of the views of stakeholders including the organised private sector, professional bodies and landlords.
The reviewed rates applicable in the LUC 2018, which drew flack from stakeholders, were as follows: owner-occupier residential property, 0.076 percent, owner occupier+commercial property, 0.256 percent; industrial/commercial property, 0.76 percent per annum.
Akinyemi Ashade, commissioner for finance, at a news conference, Thursday, attended by over 15 members of the state executive council, said the state has also resolved to waive all penalties in respect of late payment of the land use charge, in 2018, and allow installmental payments.
The new waivers announced, according to Ashade, will not affect reliefs originally inherent in the law, such as the automatic 40 percent which applies across board, and all others which the tax payers are expected to apply for, with proof, on basis of age payer and property, disability, pensioners and timely payment, among others.
Adeniji Kazeem, the state’s attorney-general and commissioner for justice said these new resolutions, will be forwarded to the state House of Assembly, which will commence a legislative process to enshrine them in the law without suspending the implementation of the LUC.
In line with these, the House of Assembly will be expected to pass the following resolutions: The regulation for review of applicable rates and regime of reliefs on categories of properties pursuant to LUC law; and the regulation for a framework for self-assessment.
According to the officials, government expects that stakeholders will participate in the legislative proceedings that will give the new rates legal effect, just as it assured that taxes paid would be made to work for the people.
“In line with this administration’s tradition of inclusive governance and civic engagement, and as a government that is committed to the welfare of its citizens and understands the importance of continuously engaging the populace, we undertook extensive dialogue with various stakeholders on the Land Use Charge (“LUC”) revised law and its implementation.
“Consequently, we received a wide range of responses from our dialogue with various stakeholders on the amended LUC Law 2018. The stakeholders included the Organised Private Sector (OPS), Nigeria Bar Association (NBA), Real estate investors & developers, Landlord & Resident Associations, Community Development Associations, Civil Society Organisations, Lagos Chamber of Commerce and Industry (LCCI), Nigeria Institute of Estate Surveyors & Valuers and several other professional groups,” the official said.
These various interactions formed the subject of extensive deliberations at the meeting of the state executive council on Wednesday, March 14th, 2018 chaired by Akinwunmi Ambode, therefore resolved as follows: Commercial property owners, who are undoubtedly the stakeholders mostly impacted by this amended law will be granted 50 percent discount. This means a commercial property valued at N20 million which was earlier billed N91,200 will now pay N45,600 per annum.
Property occupied by owner and third party & property used for industrial and manufacturing purposes will now enjoy 25 percent discount. This means that a N20 million property expected to pay N30,720 will now pay N23,040 per annum.
Owner-occupied property will enjoy 15percent discount. For a N20 million property, this used to be N9,120. Now, it is N7,752 per annum.
The penalty regime for late payment of LUC has been waived completely. Therefore, LUC payers who have received their bills will no longer be penalised for late payment of bills issued in 2018, thereby providing additional relief to LUC payers.
Other rates and reliefs, apart from the ones stated above, will remain unchanged and will be implemented as stipulated by the law. These include 40 percent general relief, 10 percent for 70 years and above, 10 percent for properties owned by persons living with disability and 10 percent for properties that are 25 years old and so on and so forth,” said Ashade.
The finance commissioner said government was appreciative of property owners of all categories who have performed their civic duties faithfully by paying the LUC.
He added that as a result of these new measures, those who have paid the original amount will be awarded tax credits to the extent of the excess amount paid and carried forward to next year.
