The Lagos State Government on Wednesday, August 5, announced the reduction of the Land Use Charge (LUC) to the pre-2018 charges; hence, indicating a reduction of 48 per cent.
The Lagos Commissioner for Finance, Dr Rabiu Olowo, made this known; at a news briefing on the 2020 New Land Use Charge Law in Alausa, Ikeja.
Olowo also announced that the waiver of penalties for LUC for Year 2017, 2018 and 2019, which translated to N5.8 billion potential revenue for the state.
He said that the Owner-Occupied Residential Property charged at 0.076 per cent, was now 0.0394 per cent; while Industrial Premises of Manufacturing Concerns, which was 0.256per cent; would now be charged at 0.132 per cent.
The commissioner said that Residential Property/Private School (Owner & 3rd Party) charged at 0.256 per cent had been reduced to 0.132 per cent.
He said that the Residential Property (Without Owner in residence), which was at 0.76 per cent; would be charged at 0.394 per cent.
Olowo said that Commercial property (Used by occupier for Business Purposes) charged at 0.76 per cent was now charged at 0.394 per cent; while Vacant Properties and open empty Land which was at 0.076 per cent, would now be charged at 0.0394 per cent.
He said that the Lagos Ministry of Finance had considered some reforms; one of which was the Land Use Charge Reform.
According to him, the state government considers the LUC reform very necessary; to accommodate the agitations of Lagos people; and reduce the financial pressure on the citizens as it relates to Land Use.
”As you are aware in 2018, there was an increase in Land Use Charge rate; as well as the method of valuation of properties; this twin shock had a sporadic increase in Land Use Charge payable by property owners.
”In view of the aforementioned, the current administration decided to review the Land Use Charge law by reversing the rate of Land Use Charge to pre-2018; while upholding the 2018 method of valuation.
”The reform also considered multiple Land Use Charge payment channels and efficient customer service management by setting up a call centre (0700 LAGOS LUC) in other to ensure prompt issue resolution,” he said.
Olowo said that in the new 2020 Land Use Charge Law, a property owned and occupied by a pensioner was exempted from paying LUC.
He also said that the percentage increase in penalties for defaults in paying LUC had been reduced.
The commissioner said that property owner defaulting in payment of LUC for 45 to 75 days had been reviewed to pay a penalty of 10 per cent from the former penalty of 25 per cent.
Penalty for defaulted of within 75 to 105 days to pay 20 per cent, instead of 50 per cent; while between 105 and 135 days had been reviewed from 100 per cent to 50 per cent.
”Still on reductions, another major sector that had its charge reduced is Agricultural sector; which annual charge rate for Agricultural land was reduced from 0.076 per cent to 0.01 per cent. This is an 87 per cent reduction from the old rate.
”In additional to the re- introduction of the 15 per cent early payment discount; an additional COVID-19 incentive of 10 per cent will be granted on the total amount payable.
“This makes the total discount for early payment 25 per cent, if payment is made before the due date.
”The penalty for obstruction of officials and damage to property identification plague has been reduced; from N250, 000 to N100,000.
”The penalty for inciting a person to refuse to pay LUC has been reduced; from N250, 000 to N100, 000; and the 2020 LUC Law introduced a 10 per cent and 20 per cent special relief for vacant properties and Open empty land, respectively,” he said.