Lagos Land Use Charge Law 2018: Just Before LASG Covers its Mess – Bolaji Ramos Esq.

Land Use Charge

The indices that make up a good standard of living in any civilized country that has the best interest of its citizens or inhabitants in mind are not just the infrastructural facilities in that state. While the importance of availability of infrastructural facilities cannot be overemphasized as they play a major role in the lives of the inhabitants of any country, good standard of living and ability of the majority of the citizens to live above poverty level continue to take the centre stage. In Lagos State, the average inhabitant is not asking the State for too much, other than simple basic amenities that will continue to compliment the continuous meager earnings that are already subject to a number of direct and indirect taxes.

With this said, one cannot but respond to some of the issues discussed by the Executive Chairman of the Lagos State Internal Revenue Service (LIRS) in an exclusive interview he granted THISDAY and its sister television network, Arise News Channel, on Monday 5th March 2018 on the one hand and the convener of the Coalition of Real Estate Investors and Surveyors in Lagos (CREIS) on the other hand, in relation to the Land Use Charge Law 2018.

After a thorough analysis of the Law, the convener of CREIS, Mr. Ayokunle Gregory, made the following points:

  1. People’s opinions about the Land Use Charge Law 2018 is full of misinformation with intention to deceive the unsuspecting public by some mischief-makers who are bent on exploiting the law for their selfish gain;
  1. The essence of the Law is to put in place a regulated and standardized system that enables clarity and self-assessment.
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What bewilders one’s mind is the suspicious way in which Mr. Gregory laboured so hard to defend the law and make it appear like a bed of roses without taking his time to comment on or try to disambiguate some of the grey areas of the law. It is not enough to just say the law grants some incentives and reliefs without stating the true intention of the makers of the law.

To my mind, half-information is also synonymous to misinformation. Mr. Gregory should have been more sincere by letting the public know that the true and principal intention of the law is to simply boost the IGR of Lagos State, instead of representing that the essence of the law is to place a regulated and standardized system in place to enable clarity and self-assessment. What have clarity and self-assessment got to do with the new formulas brought by the law that are capable of further distressing business owners, house owners and tenants who are struggling to survive in this economically recessed society? Could clarity not have been done without bringing a new formula of assessment and liability that has placed responsibility to pay the land use charge on tenants?

Perhaps the general public should have been informed by Mr. Gregory that now:

  1. A tenant may now be liable to pay land use charge even if the tenancy is for one year and the tenant has already paid his rents to the landlord for the year;
  1. A church, mosque or religious organization will be liable to pay in so far as the place of worship is not owned by it;
  1. A pensioner-owner may be liable to pay in so far as such pensioner did not retire from a pensionable office in Lagos State; and
  1. Market value upon which the assessment is based comprises both the value of the land on the one hand and the value of the building on it on the other hand, including all structures on it whether movable or immovable
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Disclosing the major reason for the increase in the land use charge, the Executive Chairman of LIRS, Mr. Ayodele Hamzat Subair, was reported to have said that it was based on the need to raise Lagos State’s IGR and expand its tax base. Mr. Subair, just like Mr. Gregory, also laboured so hard to defend the law by saying that following the drop in the oil prices and reduction in Federal allocation, the only way Lagos State could fund its massive infrastructure projects was to raise its IGR. To say that this was done with total disregard to the economic state of both corporate and individual residents is an understatement. Law is not far from reason and reasonableness. That is why every now and then the test of the reasonable man is always used to measure the standard of a particular law. Mr. Subair, in his defence of Lagos State Government and the Land Use Charge Law failed to put this fact and a whole lot of things into consideration. Perhaps, Mr. Subair should be reminded or enlightened, inter alia, that:

  1. The land use charge is a form of property tax. For all intent and purposes, it should be imposed on the owners who are receiving gains, rents or enjoying the tenements—not on tenants or lessees who have already paid consideration for their occupation of the property to the owners.
  1. Asking lessees of a 10-year and above lease to mandatorily be the ones to pay the land use charge after already paying consideration to the owners of the property is a form of misplacement of liability to a person.
  1. It is not socially equitable and against Nigeria’s fundamental objectives to pauperize struggling citizens whose salaries have not been increase and some of whose house rents have not even been paid, in an attempt to boost the IGR of Lagos State.
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Just before the mess created by the Lagos State Government through the new Land Use Charge Law 2018 is covered up by the tall tales of the Executive Chairman of the LIRS and Mr. Gregory, affected residents of Lagos State and other stakeholders are advised to do a critical analysis of both the short and long term effects of this Law. A revenue law that fails to consider social, financial and economic realities of the people it seeks to tax or charge is the true definition of an insentient, draconian and anti-people law.


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