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OPS, others kick as Ambode reviews downwards LUC rates

By Victor Ahiuma-Young, Kingsley Adegboroye,  Abdulwahab Abdulah, Olasunkanmi Akoni & Monsuru Olowoopejo

lagos—Following the controversy that trailed the 2018 Land Use Charge, LUC, in Lagos, the State Government, yesterday, announced downward review of the tax on buildings annually and introduced installment payment for property owners in the state.

The government also said it had waived completely charges on late payment earlier imposed on property owners that failed to meet the set date by it.

Commissioner for Finance, Akinyemi Ashade, Commissioner for Information and Strategy, Kehinde Bamigbetan and Attorney-General and Commissioner for Justice, Adeniji Kazeem disclosed this at an inter-ministerial briefing in Alausa.

AMBODE

The downward review by the State Government came barely two days after members of the Nigerian Bar Association, Joint Action Front, JAF and other concerned stakeholders stormed the streets, protesting against the new LUC in the state.

While admitting that the old charges created mixed feelings in the state, Ashade said the new adjustment to LUC was the outcome of extensive deliberations at Wednesday’s Executive Council meeting chaired by Governor Akinwunmi Ambode.

Explaining the new charges, Ashade said: “Commercial property owners, who are undoubtedly the stakeholders mostly impacted by this amended Law, will be granted 50 per cent discount. Property Occupied by Owner and Third Party and those used for Industrial and Manufacturing Purposes will enjoy 25 per cent discount. And for owner-occupied property, they will enjoy 15 per cent discount,” he added.

According to him, penalty regime for late payment of LUC had been waived completely. Therefore, LUC payers that had received penalty bill on late payment in 2018, thereby providing additional relief to LUC payers.

He stressed: “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 per cent general relief, 10 per cent for 70 years and above, 10 per cent for properties owned by persons living with disability and 10 per cent for properties that are 25 years old and so on and so forth.”

Ashade noted that to reduce tax burden on residents, the government would accept from property owners LUC in installment, saying, “this will help to reduce the burden of taxation on our citizens.”

LUC mediation centres

While saying that the new regime would be forwarded to Lagos State House of Assembly for inclusion in the LUC law, Kazeem stressed that resolution mechanism would be strengthen, to give residents leeway to challenge any unfavourable charges, informing that “currently, we have one in Ikeja and it is operational. And the executive council has approved that the additional four should be established in other four divisions as stipulated in the law.”

The Attorney-General explained that aggrieved tax payer had 45 days to “exhaust the jurisdiction window. And investigation showed that 80 per cent of the issues that arise were already solved through the mediation centre.”

Stakeholders react

Reacting, the Organised Private Sector, OPS, said any unilateral pronouncement by government that failed to address its concerns would not be acceptable, saying there were several avenues for litigation in the LUC.

OPS comprising the Manufacturers Association of Nigeria, MAN, Nigeria Employers Consultative Association, NECA, Nigerian Association of Chambers of Commerce, Industry, Mines & Agriculture, NACCIMA, Lagos Chamber of Commerce and Industry, LCCI, National Association of Small and Medium Scale Enterprises, NASME, and National Association of Small Scale Industries, NASSI, insisted that implementation of the new land use charge law should be put on hold until Government was able to arrive at an acceptable resolution of all the grey areas.

An unsigned document from OPS indicating a pre-knowledge of public announcement of the downward reviewed, said that OPS had observed that Governor Akinwunmi Ambode had shunned “our call for a constructive dialogue on this issue. We, however, acknowledge the fact that we have been interacting with the Commissioner for Finance, though our preference would have been to meet His Excellency, given the importance of this issue and the consequence of not coming to an understanding that the Organised Private Sector  will find acceptable. ”“We understand that government has resolved to go ahead and make a unilateral pronouncement on this matter. We hope such a pronouncement, which has been arrived at without extending to us the right of constructive discussion, would meet the expectation of the OPS. If it fails to, we will have no option but to return to the trenches and utilise all legal and legitimate means to get the sovereign to be sensitive to the voice of agony of the residents.”

NBA’s reaction

Similarly, Chairman of Nigerian Bar Association, NBA, Ikeja Brach, Adesina Ogunlana, though claimed unaware of the review, said, “my reaction is that the government is not sincere about the review. “The upward review is something that came with law and cannot be reviewed downward like that. Until the law is reviewed, we are not going to accept it. The reduction is arbitrary and illegal. Reduction is not in line with our demands and the demands of the average Lagosians. We need a total reduction of the rates. Everybody knows how difficult it is to get money under the present harsh economy. So, the government should consider total reduction”, Ogunlana said.

However, the Executive Director of Centre for Public Accountability (CPA), Comrade Femi Lawson who was elated at the new LUC review praised the administration of Governor Akinwunmi Ambode for its empathy with the people of the state. “This review shows a government that shares in the pain and concerns of the citizens of this state. Not only did they listen to our agitations but also LASG took action to allay our fears and worries by bringing the LUC rates down and introducing some other tax burden relief measures. This is surely a pro-people government.”

Also, Mr. James Garuba, Principal Partner, James Garuba & Associates, a firm of estate surveyors and valuers, asked how the government arrived at the figures it was giving to the people, pointing out that to arrive at a figure in terms of property valuation, it required a procedure that must be determined by an estate surveyor qualified professional to carry out such valuation.

According to him, “It is illegal and criminal for anybody to decide to impose charges on people’s property without the input of estate surveyors and valuers whose profession it is to value property to determine their actual value.”

Also reacting first Vice President of the Nigerian Institute of Building NIOB, Mr. Kunle Awobodu, described the downward review as a welcome development, pointing out that the action of the state government showed that it was a listening government.

Awobodu however, lamented that it was unfortunate that the relevant professional bodies were not involved in the process that led to the re-enacted Land Use Charge, adding that their inclusion in the process would have guided the government.

Similarly, Mr. Thomas Aderinola, a real estate investor in Lagos State, said the downward review of the amended LUC law by as much as 50% was a reassuring indication that the LASG is a listening government. “Imagine this huge waiver of 50%. It shows that the state government is sensitive to needs and is working for the interest of the people. We all can see what Governor Ambode is doing in the state in terms of Infrastructural development.”


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