Land use charge: Lagos owners to pay more

Lagos State House of Assembly is set to pass into law a Bill on land use charge that would be based on market value. The bill seeks to harmonize all the existing laws on properties in the State such as the Land Rates law, Neighbourhood Improvement Charge law and Tenement Rates. When passed, it will automatically translate to property owners paying more on their properties to the government based on the recommendations of government’s estate valuers and the current market value.

Making clarifications on the Bill at a public hearing on the Land Use Charge (Repeal and Re-Enactment) Law, 2017 held at the Lagos Assembly premises on Thursday, the Acting Chairman, Ad hoc Committee on Finance, Hon. Oluyinka Ogundimu, said the new law would correct some wrongs in the system.

According to Ogundimu, a situation, where some houses still pay N1, 500 as land use charge is not palatable and no longer going to be acceptable.

“We want everything to be harmonised and make it convenient for the people. We have ensured that we will consider the market value of the houses,” he said.

The lawmaker stressed that some of the houses are close to the market value, while others are far from it.

“Therefore, what would be given out would be the value of the land and the building and the rate would be determined by the government.

“What we will have will be the market value and this has been reduced by 40%. The public hearing is to hear the opinions of the people and look at their position papers.”

Commenting on the exempted list from the charge, the lawmaker noted that “Religious bodies would not be affected, but if they go commercial like running a school, they would not be exempted.

Ogundimu disclosed that the law was enacted in 2001 and that there is a need to look at grey areas and harmonise the laws.

“The enactment of the law cannot be completed without a public hearing to get responses from stakeholders”.

In his address while welcoming participants to the parley, the Speaker of the House, Rt. Hon. Mudashiru Obasa who was represented by the deputy Speaker, Hon. Wasiu Sanni Eshinlokun said the new law would make life easy for the people of the state and that the House was passionate about anything that would affect the people positively.

He therefore, urged participants to express their minds at the public hearing.

Giving the overview of the Bill, the Majority Leader of the House, Hon Sanai Agunbiade explained that the proposed law differs from the old payment charge as the new charges would be based on market value.

The Bill, in section 6, according to Agunbiade When the law eventually commences, the annual amount of the Land Use Charge payable on any Property shall be arrived at by multiplying the Market Value of the Property by the applicable Relief Rate and Annual Charge Rate using the prescribed formulae outlined below and more particularly described in the Schedule to this law.

The Bill went further to explain the formulae as Land Value + Building Developments Value * Relief Rate * Charge Rate.

According section 6 (2) of the Bill, “the land value and building value rates constituting the market value of the property and it shall be reviewed at least once every five years on the basis of information available to professional valuers, and may vary from area to area.”

However, some of the participants at the parley commended the state government for harmonizing charges on properties but strongly cautioned it not to over burden the owners and occupiers.

The Chairman of Christian Lawyers Fellowship of Nigeria, Mr. Lawrence Nnoli who picked hole in the bill said the law usurped some constitutional provisions and urged the House not to be against the federation.

He went further to implore the House to exempt some Non -governmental Organisations from payment of charges as according to him they are not profit oriented.

Also in his submission, the Executive Secretary of the Lagos State Security Trust Fund (LSSTF), Mr. Rasak Balogun said educational institutions should not be exempted from the payment of land use charge since some of them were being operated as commercial.

Balogun also advised that there should be proper identification and notification so that those coming for valuation would be identified by property owners.

He suggested that estate valuers, architects and others should be part of the tribunal to be set up for the bill, when it becomes a law.

Mr. Thompson Akpabio, who spoke for the organised private sector said the new bill would increase the burden of property owners in the State.

The Chairman of the Nigerian Institution of Estate Surveyors, Mr. Olurogba Orimolade however, suggested that at least three estate surveyors should be appointed as members of the tribunal.

“Estate surveyors should be part of the tribunal as they know much about valuation. We should be seen as partners in progress.

“The formula should have more engagements of the institution and I would say that the Lagos State Government is losing money”.

By Alade Tasma