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Principal members of the Lagos State House of Assembly have continued to keep sealed lips on the Land Use Charge (LUC) which implementation drew flaks from a wide spectrum of the society in March this year, compelling the state government to slash what many dubbed “outrageous” rates.
The House of Assembly had earlier passed the LUC law which was subsequently assented to the state governor, but was forced to reconvene a public hearing on Tuesday March 27, after it admitted to an error in earlier passed law which featured a private tax consulting firm.
Nearly two months after the public hearing which saw array of segments of the society- professional bodies, landlord associations, estate developers, property valuears and the Organised Private Sector (OPS) bombarding the House chamber, to voice their opposition and demanded a suspension or reversal to the old rates, key members of House of Assembly, has continued to keep mum and foot-drag the outcome of the six-man ad hoc committee saddled with the task of reviewing the law to enable the House give new legal backing.
Calls placed to Moadaishiru Obasa, speaker of the House, Tunde Braimoh, chairman, House Committee on information and strategy, Bayo Osinowo, chairman, LUC review committee, on Tuesday were not were not responded to. The three key members of the House did not also respond to SMS sent to their GSM phones, even after one of them requested that a SMS be sent rather than a call. “Pls send a text” said one of the three, but he refused to respond after the text was sent.
But while the lawmakers vacillate; BusinessDay has gathered that the state government is not likely to further review downward the rate applicable to commercial property in its 2018 LUC law.
The LUC is a consolidation of ground rent, tenement rate, and neighbourhood improvement levy. 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 cease to apply to any property in the state as from February 2018.
A source which craved anonymity told BusinessDay that the government is not considering a further reduction in the LUC rates after it was forced to slash the original rates.
“The LUC and the rates applicable to commercial property or any other property mentioned in the law is not meant to serve the government. Rather, it is a law that the state government believes will enable it serve Lagosians better by building the necessary infrastructure
The House of Assembly is working on it. It is taking a little longer because the House had to go on recess after the public hearing in March. We should just wait to see the outcome,” said a source.
The original rates which are based on current market value of eligible property were as follows: owner-occupied residential property, 0.076 per- cent per; industrial premises of manufacturing concerns, 0.256 percent while commercial property attracted 0.76 percent.
The state government had reduced the rate on commercial property by 50 percent, and also reviewed downward other rates as they affect owner-occupied/tenant and purely residential property as well as granted general and specific reliefs.
The downward review which followed weeks of sustained agitations by various groups were as follows: Commercial property, 50 percent; Owner-occupied/tenant, 25 percent; purely residential 15 percent; general relief, 40 percent; persons above 70, 10 percent; People Living With Disability (PLWD) as well as property above 25 years, 10 percent.
Akinyemi Ashade, the commissioner for finance announced the reduction had said the reduction was a fallout from widespread dialogue with stakeholders, such as the organised private sector (OPS), the Nigeria Bar Association (NBA), real estate investors and developers, landlords and residents’ associations, community development associations, civil society organisations (CSOs), Lagos Chamber of Commerce and Industries (LCCI), Nigeria Institute of Estate Surveyors and Valuers and professional groups.
Amid rising tension still, the state House of Assembly subsequently organised a public hearing on the LUC on March 27. But the Ikeja branch of the NBA led by Adesina Ogunlana and their civil society allies, Joint Action Forum (JAF) led by Abiodun Aremu, walked out of the public hearing and insisted on total reversal of the law. The group vowed to continue protests in the streets until the government cancel the LUC.
JOSHUA BASSEY
