Sanctions to defaulters under the Reviewed Land Use Charge (LUC) Law of Lagos are too severe and not in tandem with democratic ideals.
The President of Lagos Chamber of Commerce and Industry (LCCI) Mr Babatunde Ruwase, made the observation in Lagos last Friday during a stakeholders’ forum on Lagos Land Use Charge Law, 2018.
He said that while the chamber would not encourage or support any form of infractions of the law, the sanctions must be proportional and fair.
The Tide source reports that the Land Use Charge Law stipulates a 25 per cent increase in charge if payment was not made between 45 and 75 days.
It also prescribed a 50 per cent increase after 105 days and a 100 per cent increase if payment cannot be made between 75 to 105 days.
The law further prescribed that a property shall be liable to enforcement if payment is not made after 135 days of notice.
“There would be instances where the citizens are willing to pay, but just do not have the capacity to pay, given the state of the economy.
“The Nigerian economy is only just gradually recovering from recession. Many companies are yet to return to profitability.
“Industrial capacity utilization has declined, purchasing power is still very weak, occupancy rate is mainly commercial and residential properties are still very low.
“All of these have adversely impacted the returns on investment in property market and points to the fact that current market value of property may not necessarily reflect the rental income for the property”, Ruwase said.
He said that only 300,000 property were paying the charge, while 700,000 property were identified for tax payment.
According to him, emphasis should be on getting more property into the tax net, rather than imposing additional burden on those currently on the database.
He urged government to explore the platform presented by VAIDS to capture more property owners into the net.
Ruwase suggested that implementation of the law be suspended, while the grey areas should be sorted out in the interest of fairness, equity and natural justice.
According to him, there is no evidence to show that adequate dissemination of information to critical stakeholders were followed and conditions stipulated for law review occurred before implementation of the law.
He said that stakeholders were concerned that assessed value used for computation of the law was high and difficult to justify.
According to him, the business community appreciates government’s efforts in investing in infrastructure and security and businesses are willing and ready to pay their tax.