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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