The Lagos State Government on Wednesday, March 7, 2018 clarified the figures circulating in the media on the rates for the newly reviewed Land Use Charge Law of 2018, saying many of the numbers were based on several years of arrears on the levy not paid by affected property owners.
Speaking at a news briefing held at the Bagauda Kaltho Press Centre in Alausa, Ikeja, the State’s Commissioner for Information and Strategy, Mr Kehinde Bamigbetan, said there were so many misconceptions and misinformation about the new law, adding that the law was a progressive enactment duly made by the House of Assembly and handed over to the Executive for implementation in the overall interest of the people.
He specifically dismissed the figures being bandied about on the social media, describing them as humongous, and saying many of the calculations were based on arrears of many years of non-payment.
“The fact is that this law took a long process to be made. It started as a bill and went through the first reading, second reading, public hearing to which all stakeholders were brought together to debate it and some of the relieves we have seen were part of the debate expressed by the stakeholders about the need to protect the vulnerable segment of the society. Having made the law, the Lagos State House of Assembly has handed it over to the executive to implement.
“The second important part is that a lot of relieves have been built into the law but many people are confusing arrears with the actual figure. If you see those figures, ask whether it is for one year or arrears of several years of non-payment. The humongous figures that are being bandied around particularly in the social media relate to the arrears of many years of non-payment which are computed together,” Bamigbetan said.
Also speaking, Commissioner for Finance, Mr Akinyemi Ashade, said the government has extended the period for tax payers to enjoy the 15 per cent discount in the reviewed Land Use Charge Law to April 14, 2018 in order to enable the implementation and enforcement of the new law, as well as allow many property owners to benefit from the discount.
Ashade, who took time to clarify reactions in some section of the public on the new law, said that, under the old law, which had not been reviewed for over 15 years since 2001, the Land Use Charge rate was totally inaccurate and retrogressive and was depriving the state of keeping track of all economic activities that relate to land in Lagos State.
He said the rates, which were reviewed by the Lagos State House of Assembly and signed into law by the State Governor, Mr. Akinwunmi Ambode, on February 8, 2018, is a merger of all property and land-based rates and charges in the state.
Ashade said: “There was an urgent need for the repeal, as the old law had not been reviewed for over 15 years since 2001. Under the old law, the LUC rate was totally inaccurate and retrogressive which deprived the state of keeping track of all economic activities that relate to land in Lagos State.
“The new law is a consolidation of Ground Rent, Tenement Rate, and Neighbourhood Improvement Levy. This charge is payable annually in respect of all real estate properties in the State, which means owners and occupiers holding a lease to a property for 10 years or more are now liable to pay the annual LUC invoice charged.
“Thus, the Tenement Rates Law, the Land Based Rates Law, the Neighbourhood Improvement Charge and all other similar Property Rates or Charges, Laws or amendments to any such property Laws shall cease to apply to any property in Lagos State as from 2018. Nonetheless, all pending invoices, orders, rules, regulations, etc. under the 2001 repealed Law shall continue to be in effect until such obligations are discharged.”
Explaining the calculation of amount payable, the Commissioner said that property owners can determine the amount by multiplying the Market Value of their property by the Applicable Relief Rate of 40 per cent and Annual Charge rate.
“Upon receiving a notice or not, the new law has made it possible for owners to calculate their charge, and enable prompt payment, which allows them to benefit from a 15% discount for early payment, applicable to payments made within 15 days of receipt of Demand Notice,” he said.
Responding to fears of tenants that the new law might force landlords to increase rent, Ashade said aside the fact that the Lagos State Tenancy Law 2011 was still in force, the incidence of payment for Land Use Charge under the new law is on the landlord and not the tenant.
He said the minimum rate was only increased from N1,200 it was in 2001 to N5,000, while there is provision for self-assessment and Assessment Appeal Tribunal under the new law.
On vacant properties, Ashade said such would be treated based on owner-occupier and not as a commercial property, explaining that the target of government is to make commercial property owners to pay a little bit more.