Lagos reverses Ambode’s LUC law, gives 48 percent reduction

August 5, 2020
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<!– Ambode and Sanwo-Olu –>

Former Governor, Ambode and Governor Sanwo-Olu

By Kazeem Ugbodaga

The Lagos State Government has reversed the 2018 Land Use Charge, LUC, Law and effected a reduction in the annual charge payable by property owners in the state by 48 percent.

Former Governor of Lagos State, Akinwunmi Ambode had reviewed the LUC in 2018, jacking it up, which led to serious outcry from the public, but he later reduced it, but still on the high side.

However, Commissioner for Finance, Dr. Rabiu Olowo disclosed on Wednesday at a news conference in Ikeja that the government had further reduced LUC by 48 percent.

Olowo said the government considered the Land Use Charge reform very necessary to accommodate the agitations of Lagosians and reduce the financial pressure on citizens as it related 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 stated that with the 48 percent reduction in the annual charge rates, Owner-Occupied Residential Property would now pay 0.0394% instead of 0.076%; while Industrial Premises of Manufacturing Concerns will pay 0.132% instead of 0.256%.

Also, Residential Property/Private School (Owner & 3rd Party) will now pay 0.132%0 instead of 0.256%, just as Residential Property (Without Owner in residence) will pay 0.394% as against the previous 0.76%, while Commercial property (Used by occupier for Business Purposes) will pay 0.394% instead of 0.76% and Vacant Properties and open empty Land, 0.0394% instead of 0.076%.

According to Olowo, another major sector that had its charge reduced was Agriculture, which annual charge rate for Agricultural land was reduced from 0.076% to 0.01%, representing 87% reduction from the old rate.

He disclosed that penalties for LUC for 2017, 2018 and 2019 had also been waived, which translated to N5.752bn potential revenue waived by the State.

“In additional to the re- introduction of the 15% early payment discount, an additional Covid-19 incentive of 10% will be granted on the total amount payable. This makes the total discount for early payment 25% if payment is made before 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

“The 2020 LUC Law introduced a 10% and 20% special relief for vacant properties and Open empty land, respectively. The right of enforcement has been reduced from notification of three (3) default notices to (2) default notices. Profit oriented Cemeteries and Burial Grounds are no longer exempted from payment of Land Use Charge. Private Libraries are also no longer exempted from paying Land Use Charge,” he said.

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