LAND USE CHARGE OF LAGOS STATE, PENALTY FOR NON-PAYMENT AND NEED FOR COMMON SENSE
The
recent uproar arising from the amended Land Use Charge of Lagos State has
attracted my attention as most of our clients have been calling to ask for clarification
and professional guidance. My concern is not only about the methodology and principles
of arriving at the Charges being levied to occupiers and owners of properties,
this aspect is being questioned by the Nigerian Institution of Estate Surveyors
and Valuers of which we are certified members.
My concern has been on the
penalty for nonpayment. A Landlord who owns a tenanted apartment will derive
money to pay for the Land Use Charge of his property from the rent realized
from the tenanted property. If you
consider the penalty clause for non-payment on time: If you don't pay after
3months an increment of 125% of the value of the bill, by six months 150% of
the bill, then if you do not pay for the year it doubles to 200% of the bill.
This is really laughable! really!
When you consider this penalty vis-a-vis the Lagos Tenancy Law of 2011 which
considered that a yearly tenant is said to have defaulted when he/she owed a year's
rent, same with a monthly tenant etc. In all the provision of the law, there was
no mention of penalty for non-payment of rent when due, no percentage increment
of rent for defaulters. Since it is expected that the rent accruing from
the property should be used to service this Land Use Charge, instead of using
the rental value of the property to assess the Land Use Charge, Capital value
was adopted. This is really laughable. Indeed, this land Use Charge is clearly contradictory
to the Governmental responsibility of making housing available for all. It is
against investment in housing development and it will result in high increase
of rent by Landlords to meet up with the high demand of Land Use Charge by
Government.
In conclusion, if the Lagos State
Government insist on implementing the penalty of the Land Use Charge as it
presently is, then it would only be fair to the Landlords that a complementary
change be effected in the Lagos Tenancy Law of 2011 to penalized tenants for
not paying their rent when their rent expires. The same increments in the Land Use Charge should immediately be enshrined in the Tenancy Law.
This is common sense.
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