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Lagos Land Use Charge: Why The Rich Are Crying Wolf

We, at the Centre for Public Accountability (CPA) as well as our civil
allies across the nooks and crannies of Lagos State are concerned at the
implications of recent outcry and what we observe, as the crocodile
tears being shed by a seemingly privileged, social segment of the Lagos
State populace on the implementation of Land Use Charges Law, 2018.

The most comical of these groups, is the Nigerian Bar Association, NBA,
Ikeja Branch that has thrown professional etiquettes to the winds,
abandon its well-cherished traditions as the defender of the less
privileged and socially alienated to become the mercenary megaphone of
some over pampered, higher middle class perpetual public tax evaders.
 
Our take up point in this brief intervention would be to condemn in
un-mistaken terms, reports in the news media particularly that of The
PUNCH newspaper of Thursday, 8th, 2018 where a purported seven-days
ultimatum was issued to the Lagos State Government by one, Mr. Adeshina
Ogunlana, the Chairman, NBA, Ikeja branch to reverse the Land Use Charge
Law, 2018. An act that was never a product of arbitrary proclamation of
the State Governor! It is a great wonder that learned men of the legal
profession cannot simply take the civilised means of rectifying of
perceived social injustice by approaching the competent court of law to
seek judicial pronouncement on the law but rather gentlemen of the legal
profession are threatening fire and brimstone to take laws into their
own hands by disrupting law and other in the State. We unequivocally
condemn the plan of Ikeja NBA to cause public riot in the State if the
law is not reversed. Need we remind the NBA Ikeja branch that other
well-meaning Lagos civil society organisations like ours are at liberty
to rally round our members to equally protest the attempt of the Bar to
instigate chaos in our State. We recall that the NBA under late Alao
Aka-Bahorun and Olisa Agbakoba played progressive roles while lawyers
like late Kanmi Ishola-Osobu and Chief Gani Fawehinmi always tilt
towards the majority poor and not a minority, few privileged cabals.
What the Land Use Charge Law 2018 is all about: In simple term, the law
repeals an earlier one of 2001, therefore, it is not new. It also
consolidated ground rent, tenement rate and neighbourhood improvement
levy, therefore, Lagosians would not be victims of multiple taxations
under the new law. The law went through the required legislative
processes before it was passed which included a public hearing where
those now crying could have ventilated their apprehensions; this process
brought a number of reliefs that were embedded in the law. It is trite
in law to re-emphasise that equity does not aid the indolent who sleep
on their rights. It also put in place a defined, scientific and
progressive tax system that weighs heavily on the upper class of the
society who do not always want to pay tax. Since over fifteen years that
the law was first enacted, despite astronomical inflationary index, the
minimum charge in 2001 is N1,200 (One Thousand and Two Hundred Naira)
and in 2018, it is N5,000 ( Five Thousand Naira), it is only the
super-rich with exotic properties in choice locations like Lekki
Peninsula, Ajah, Victoria Garden City, most of whom are rentier owners
with suspicious means of income yet that are paying more because of the
progressive nature of the charges. The proceeds accruing from these
charges are statutorily bound to be shared between the Lagos State
Government and the 57 Local Government and Local Council Development
Areas to finance the infrastructural deficit of the fast-growing
mega-city. The law set out self-assessment criteria for property owners
and established a Land Use Charges Assessment and Appeal Tribunal
(LUCAAT). The charge rate’ self-evaluation process is as simple as
contextualized below:
·        A landlord living alone on a property with family (No tenant).
The annual fee is 60% of the value of the house × 0.076%. E.g. if your
house is valued at N20m. Your fee is 0.076% of (60% of N20m) = 0.076% x
N12m = N9,120.00 per annum.
·          If the property owner rented out the house to tenants only
and does not live there and the house is worth N20m. You will pay
0.76%of (60% of N20m) =0.76% of N12m= N91,200.00 per annum.
·          If the landlord is living with tenant in the same building of
the above value. You will  pay 0.256% of (60% of N20m) =0.256% × N12m=
N30,720.00 per annum
Clearly, this fact speaks for itself that the aim of the law is to
ensure that properties are property and progressively valued with a
lesser burden on the less privileged. It should be added that the value
of properties also varies from one location to the other. The reliefs
that the law granted included the followings:
“A general 40% relief for all property liable to LUC payment, a 10%
relief for owners and occupiers with persons with disabilities, a 10%
relief for owners and occupiers of 70 years and above, a 10% relief for
properties above 25 years, a 5% relief for properties occupied by their
owners for over 12 years, a 20 % relief for non-revenue generating
federal and state government property, and 20% partial relief for
non-profit making organisations”

Pensioners, churches, mosques, palaces, public places are exempted.
Why are the Super-Rich Crying Wolf? CPA notes that it has become a norm
in our country that most privileged individuals in our country only want
to benefit maximally from the society without giving anything back as a
birthright. Most elected politicians usually run to procure tax
certificates when they are vying for elections which means they don’t
pay taxes unless when it becomes highly imperatives. In the same manner,
even private companies deduct taxes from and other statutory deductions
like pensions, health and housing schemes from employees but don’t remit
same. The public sector is even worse, they make the deductions and loot
them into private accounts, the cases of Abdulrasheed Maina of the
pension funds scandal and Prof. Usman Yusuf of the National Health
Insurance Scheme are still very fresh in our minds.

It is in the character of Nigerian upper middle class to illegally
corner wealth and store same in tax haven as has been revealed with the
Panama Papers and other mind-boggling revelations of Nigerians try to
evade paying appropriate taxes. The Minister of Finance, Mrs. Kemi
Adeosun is presently leading a Federal Government campaign on Voluntary
Assets and Income Declaration Schemes (VAIDS) to encourage notorious tax
evaders to pay within a clemency period or face stiff penalties and
prosecution. Every rational person knows that tax is a fundamental means
for Government to raise resources to meet up with the provision of
social amenities that make life more amenable to the citizens.

The Lagos Land Use Charge Law is only unique to the extent that it
aspires to progressively tax the more privileged citizens to help in
providing humane living environment for the less privileged. This is
however not accidental, Government has over the years provided good
ultra-modern environments for people living in areas like the Lekki
Peninsula, Ajah, Ikoyi and Victoria Garden City, now the same government
is asking people who have properties in these places to pay quality and
commensurate land use charges so that other areas of the State like
Ajangbadi, Ikorodu, Ajegunle can be upgraded.

We call on all Lagosians to join hands at ensuring that even when there
is en-even development in various areas of the State, that there is also
a combined development whereby those areas that are more
socio-economically advanced give a helping hand to bring up areas that
are still crawling. This is the main social kernel of this land use
charge,  it is a tip of social re-distribution of growth and social
equity to all. The super-rich should stop crying wolf and pay up.
Together, we can move Lagos forward.
Yours Faithfully,
Comrade Olufemi Lawson,
Executive Director,
Centre for Public Accountability, CPA

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