Following the announcement of the re-enacted Land Use Charge Law (LUCL) 2018 of Lagos State, the Coalition of Real Estate Investors and Surveyors in the state has revealed that after its thorough analysis of the LUCL 2018, Owners-Occupiers are expected to pay a token percentage of 0.076 percent increase of the value of the assessed property.
Mr. Ayokunle Gregory, Convener of Coalition of Real Estate Investors and Surveyors in Lagos, made this revelation through a press statement after a closed-door meeting of the Coalition held in Lagos on Friday, March 2, 2018.
While also expressing dismay at the level of misinformation circulating about the law among the unsuspecting public, Gregory further stated that some mischief-makers were bent on exploiting the new law for their selfish purpose by confusing the entire populace through dissemination of half-truth.
“And as such, we feel obliged to address the falsehood from a professional perspective before the unsuspecting public is misguided to bewilderment and violation of the law,” he said.
The newly implemented LUCL 2018 repealed the Land Use Charge Law 2001 (the LUCL 2001) that lacked clarity on the formula used to derive an accurate rate. Also, under the old law, the LUC rate was totally inaccurate and retrogressive which deprived the state of keeping track of all economic activities on land in Lagos State.
According to the coalition, the reviewed LUCL 2018 is to put in place a regulated and standardised system that enables clarity and self-assessment. It was reviewed by the Lagos State House of Assembly and signed into Law by the Lagos State Governor, Mr. Akinwunmi Ambode on February 8, 2018. Property owners in the state have gone ahead to pay their LUC following the flag off by the Lagos State Governor on February 19, 2018.
The law 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 shall cease to apply to any property in the State as from February 2018.
Nonetheless, all pending invoices, orders, rules, regulations, etc. under the 2001 repealed Law shall continue to be in effect until such obligations are discharged.
The LUCL is payable annually by owners and occupiers holding a lease to a property for 10 years or more. Using the applicable formula provided by the reviewed law, owners and occupiers can now calculate their rate by multiplying the Market Value (MV) of a property by the Applicable Relief Rate (RR) and Annual Charge Rate (CR).
Providing detailed breakdown on the law, Ayokunle Gregory said, “For Owner-occupied residential property, the LUC per annum is at 0.076 percent increase. For instance, if the Market Value of an owner-occupied property is at N15, 000,000.00 it means that that the amount payable is N6,840 per annum only which amounts to N570.00 per month. For a property occupied by tenants, used for commercial purposes, at the same Market Value of N15, 000,000.00, the LUC rate of that property will be N68, 400 per annum”.
It was made known that the state government has made available some reliefs applicable to the entire property owners and also some specific owners according to their status.
“These include a general 40 percent relief for all property liable to LUC payment, a 10 percent relief for owners and occupiers with persons with disabilities, a 10 percent relief for owners and occupiers of 70 years and above, a 10 percent relief for properties above 25 years, a 5 percent relief for properties occupied by their owners for over 12 years, a 20 percent relief for non-revenue generating federal and state government property, and 20 percent partial relief for non-profit making organisations”, he disclosed.
In addition, some properties are exempted from the LUC payment, such as properties used for public and religious activities, properties used as registered educational institutes and charitable activities, properties occupied and owned by pensioners of 60 years and above, public cemeteries and burial ground and all palaces of recognised Obas and Chiefs in the State.
According to the press statement, the state has provided professional services of registered Estate Surveyors and Values to get accurate data which will help in assessment and valuation of properties in the state.
“In order to clear the air of any misinformation, we implore all owners and occupiers of properties in Lagos to do a self-assessment using the formula provided, and also provide officials with valid documents to ensure a smooth run of the exercise for the benefits of all”, the coalition concluded.