Oredola Adeola
The Governor of Lagos State , Mr Akinwunmi Ambode has disclosed that his administration is willing and ready to dialogue on the Land Use Charge which he recently passed into law.
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| Mr. Akinwunmi Ambode, Lagos State Governor |
He stated this while reacting to the concerns raised over controversial bill at an event tagged :Lagos Means Business, held on Tuesday at Eko Hotel and Suites, Lagos state.
Recall that the controversial bill met stiff opposition from concerned individuals in the state, who believed that the new law will upscale property tax.
The Land use Act was enacted by the Fashola Administration with the intention of upscaling revenue derivable from the hitherto Tenement rate which was then administered by Local government authorities in the state.
Many properties stakeholders in the state believe the current increase would have spiral effect on properties and rents, as landlord may be forced to push the burden of the rate on tenants.
Speaking on the topic : A Presentation of Lagos State Giant Stride & Review of Government- Business Collaboration Towards Accelerated Economics Development.
Governor Ambode said, "The good part of the arguments trailing the Lagos Land Use Charge is that the State Government is ready for dialogue and will welcome the complains of dissatisfied members of the public in this regard.
He noted that he was aware of the controversy generated by the revised Land Use Charge Law, and that the government is ready to dialogue to resolve the issues going forward.
The Governor further revealed that the review of the law was not a deliberate attempt by the government to overburden property owners but a decision taken in the overriding interest of the future of Lagos.
He added that the Law, enacted in 2001 provides for an upward review every five years, but that the State Government had not carried out any review of the Law up until 2017, adding that the recent review was in line with the present economic realities.
He said, “The law was made in 2001. It provides that every five years, we should review it and also find a way to increase. 15 years after in 2017, the law has never been reviewed.
"Now, the question is this; those who are having commercial properties, the rental income they were getting in 2002 as against the rental income they are getting in 2017, is it the same?
“The level of infrastructure that existed in 2002 as against what has happened in the last 15 years, are they the same? Did it not come at a cost? So, why is the market value of the property that you built with one million naira, 15 years after, you are selling at N20million.
“Why do you think somebody who is a buyer will pay N20million for it? Is it not because of the facilities around the property? So, we have to sacrifice; that is how it works everywhere.
“So, somebody comes and say we have increased by 400 per cent. The question is the 400 per cent of what? You were paying N10, 000 before, now we say you should pay N50, 000 and you are calculating and turning statistics upside down by saying it is 400 per cent," Ambode disclosed.
According to him, while the revised Land Use Charge law requires owner-occupiers to pay just 0.076 per cent, pensioners, churches, mosques, non-governmental organisations and government institutions are exempted from payment.
He said, “So, who is the one that will take care of the ones that are free? If you are owner-occupier you don't need to pay. So, it's the commercial part that people are complaining about.
“Why have we increased the rate? We should have been doing this every five years but I am looking at it if I must sustain the level of my vision, I have to give something back to people.
"I don't have to come and meet you if I continue to borrow money, but we are borrowing to punish you ultimately which is not what we want because it is even the taxes you pay that would pay the interest and the principal.
"Somebody needs to tell us the bitter truth for us to sacrifice together and that is what we have done,” Governor Ambode said.
Reeling out statistics to explain the challenges that would confront the State in the nearest future, the Governor said Lagos is projected to become the third largest consumer market in the world with a population of 35.8million, closely behind Tokyo and Delhi, while the population growth and rapid urbanization would put infrastructure and public services under pressure.
He confirmed that the State requires a minimum of $50billion over the next five years to bridge the gap of infrastructural deficit, adding however, that a special infrastructure fund that would be driven by the private sector to address social challenges is the way to go.
“Assuming the entire budget for 2018 is spent only on infrastructure development, Lagos will be left with a deficit of about N14.47trillion and also require an additional 19 years of similar expenditure to bridge the infrastructure deficit,” Governor Ambode said.
The Governor noted that out of the eight million taxable adults in the State, only about two million submitted their tax returns while only 700,000 actually paid their taxes last year.
“We are 24million; taxable adults in Lagos is 8million. The number of people that actually submitted tax returns in 2017 is 2million and then only 700, 000 people paid their taxes,” he said.
He added that the current tax returns were not enough to cater for the capital projects ongoing across the State, adding that major cities across the world with thriving economies are sustained by the taxes paid by residents.
Acknowledging the support of business community over the years, Governor Ambode affirmed that his administration was committed to creating an enabling environment for businesses to thrive, adding that concerted efforts have been made to encourage investors to set up their businesses in the State, which according to him would have multiplying effects on the State’s economy.
Ambode however charged the stakeholders at the event to own the economy. He assured them that every suggestion made during the event would be taken seriously, affirming that the gathering is not just about knowledge sharing, that it’s more about the future of Nigeria and not just Lagos.
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