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Ambode slashes Land Use Charge; makes 7 important changes


Ambode slashes Land Use Charge; makes 7 important changes

In the end, the Lagos State Government bowed under pressure as Lagosians united in opposition to the recently introduced levies for the state’s new Land Use Charge (LUC).

The new Land Use Charge Law (LUCL) 2018, which applies to real and landed property in the state, had consolidated all property and land-based rates/charges into a single property charge and set modalities for levying and collection of the charge.

However, pressure groups like the Nigeria Bar Association, Committee for Defence of Human Rights, Joint Action Front, the Human and Environmental Agenda, Manufacturing Association of Nigeria, as well as ordinary Lagosians were emphatic in their rejection of the new levies. 

READ: Reuben Abati: Lagos state and the politics of taxation

On Thursday, the government announced seven key changes including a slash of the levies for the hardest hit stakeholders.

A big announcement

To show how serious the government was taking the outcry over the policy, the media briefing announcing the new rates had all members of the state executive council (apart from the governor, Akinwunmi Ambode) in attendance.

Speaking on behalf of the government, the state Commissioner for Finance and Special Adviser to the Governor on Taxation and Revenue, Akinyemi Ashade, announced the changes which were a fallout of  “extensive deliberations at the meeting of the Lagos State Executive Council on Wednesday, March 14th, 2018.”

1.  Commercial Property: Commercial Property owners, who are the heaviest hit stakeholders, will be granted 50% discount. This means a commercial property valued at N20 million which was earlier billed N91,200 will now pay N45,600 per annum.

2. Property Occupied by Owner and Third Party & Property Used for Industrial and Manufacturing Purposes: These categories of property will now enjoy 25% discount. This means that a N20 million property expected to pay N30,720 will now pay N23,040 per annum.

3. Owner-occupied Property: This category of property will enjoy 15% discount. For a N20 million property, this used to be N9,120. Now, it is N7,752 per annum.

4. No late penalty: According to the government, 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.

5. Payment in installments: Owners of property across all categories will now be allowed to make payments in installments.

6. Tax breaks for earlier payments: Those who had already paid the new LUC would be awarded tax credits to the extent of the excess amount paid and carried forward to the following year.

7. Five tribunals: The commissioner for justice, Adeniji Kazeem, who was also at the briefing, said that the dispute resolution mechanism of the law was also reviewed. There will now be five tribunals in the five divisions of Lagos state, as opposed to just one previously.

Other points to note:

According to the finance commissioner, 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% general relief, 10% for 70 years and above, 10% for properties owned by persons living with disability and 10% for properties that are 25 years old and so on and so forth.

He also said that a regulation would be sent to the Lagos State House of Assembly for review and passage, and urged stakeholders to participate in the legislative proceedings.

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