Reduction to cost Lagos N5.8 billion
Benjamin Omoike l Wednesday, August 05, 2020
IKEJA, Nigeria – Lagos State government today (Wednesday) announced a reduction in the Land Use Charge Rates, cutting it by 50 per cent.
The state Commissioner of Finance, Dr Rabiu Olowo, while announcing the reduction at a press briefing at the Bagauda Kaltho Press Centre, Alausa, Ikeja, said the new 2020 Land Use Charge Law replaces the 2018 Law, and that it is aimed at reducing the financial pressure on Lagosians in view of the Covid-19 pandemic.
“We considered the Land Use Charge reforms very necessary, to accommodate the agitation of Lagosians and reduce the financial pressure on citizens as it relates to Land Use. As you are aware in 2018, there was an increase in Land Use Charge rates, as well as the method of valuation of properties. This twin shock had a sporadic increase in Land Use Charge payable by property owners.
In view of the aforementioned, the current administration decided to review the Land Use Charge Law, by reversing the rate of Land Use Charge to pre-2018, while upholding the 2018 method of valuation,” he said.
According to him, the new law allows a property owned and occupied by a pensioner to be exempted from paying the charge, while percentage paid as penalties for defaults have also been reduced.
For a 45 to 75 days default in payment, it has been reduced from 25 per cent to 10 per cent , while 75 to 105 days default now attracts 20 per cent instead of previous 50 per cent penalties. A 105 to 135 days default penalties now attracts 50 oer cent as against 100 per cent.
“There is also a 48 per cent reduction in the Annual Charge Rates. For owner-occupied residential property, the rate has been brought down from 0.076 per cent to 0.0394 per cent,
Industrial Premises of Manufacturing Concerns brought from 0.256 per cent to 0.132 per cent, Residential Property/Private School (Owner & 3rd Party) reduced from 0.256 per cent to 0.132 per cent, residential property (without owner in residence) from 0.76 per cent to 0.394 per cent,
commercial property (used by occupier for business purposes) from 0.76 per cent to 0.394 per cent, while vacant properties and open empty land from 0.076 per cent down to 0.0394 per cent.”
In the agricultural sector, the Commissioner said the annual charge rate for agricultural land has now been reduced from 0.076 per cent to 0.01 per cent, which is an 87 per cent reduction from the old rate.
He said the state government has also reduced penalties for Land Use Charge for Year 2017 and 2018, while penalties for 2019 have also been waived.”
He said the reductions would cost the state government a loss of N5,752,168,411.03, which would have been revenue the state is supposed to generate.
Dr Olowo said the government has also reduced the penalty for obstruction of officials and damage to property identification plague from N250,000 to N100,000, while penalty for “inciting a person to refuse to pay LUC has been reduced from N250,000 to N100,000.”
“The 2020 LUC Law introduced a 10 per cent and 20 per cent special relief for vacant properties and open empty land, respectively. The right of enforcement has been reduced from notification of three default notices to two default notices. Profit oriented cemeteries and burial grounds are no longer exempted from payment of Land Use Charge. Private libraries are also no longer exempted from paying Land Use Charge,” he added.
He said officials of the government would begin to distribute the new rates and enjoin property owners “to leverage on the 25 per cent early payment discount.”
