A tenement is any type of property, such as an estate or land, that is owned by one person and leased to another. Although a tenement has many units attached together under one roof, they are divided by walls to give each family or occupant his or her own space and privacy.
Tenement rates are property taxes paid by landlords and or Occupiers of a Building payable to local government Councils as part of their internally generated revenue. Recently I conducted a study on the subject of tenement rates which has become a vexed issue because of the inherent abuses by arbitrary rate increases, failure of most landlords to pay their rates as at when due with the consequent transferred burden on tenants. The objective of the study conducted through my organization, Centre for Development Initiatives and Advocacy was to determine the impact of tenement rates on small businesses and infrastructural developments in south eastern states with the collation centre at my law Office at 11 Ihioma road Amaifeke, Orlu.
It was found as a fact that there is no generalized systemic formula or active determinants employed in fixing the rates charged. The rates were quite exploitative and undermining the development of housing, including the development of local economy and small businesses. It was also found that there is a general evasiveness of taxes by landlords and the unfairly transferred burden on tenants as occupiers. There are also associated fiscal leakages and corrupt practices by revenue officers in collusion with the so called revenue consultants whose roles have been increasingly challenged.
The uses of revenue agents and consultants remain the major cause of the arbitrary tenement rates increments for selfish reasons. It is also a sad development that governments can delegate their functions to organizations without mandate or legislative assent and creating the permissive leakages that has undermined infrastructural development.
Introduction to the controversy
Tenement rates are land use charges imposed on buildings developed by landlords to enable the generation of revenues necessary for the development of infrastructures and social amenities such as pipe borne water, street lights, parks, markets, roads, maintenance of drainages and sustainable sanitation services. In any system where the tenement rates and other associated charges such as the renewable registration of business remises are properly articulated by policy, legislation and honest endeavours, there are always clear infrastructural development, industrial and commercial stimulation which drives the local economy, creates jobs and promotes a spirited poverty alleviation and grass root development.
Who should pay tenement rates?
This is seemly a straight forward question which has been answered before. The landlord is the person that is expected to pay the tenement rate to the local government council or the occupier. The term the occupier may also refer to the landlord where he is also the occupant of the building and has not let or leased same out or sadly, the tenant in occupation.
However as it is usually the case, the landlord often lets out the premises to a tenant or group of tenants and thereafter takes no responsibility for the payment of the property taxes, especially in such cases that he does not reside in the premises.
Naturally, when the landlord is inaccessible or lives outside the jurisdiction of the local government, he cannot be reached and served with the appropriate demand notices and or summons. However, the use of the word occupier enables the revenue officials to hold the tenant responsible for the assessed rates in respect of the property.
The tenants on their part are not very willing to pay the arbitrary fees charged as tenement rates since the amounts are very high, annually increased, exploitative, often unreceipted, or fraudulently receipted, and or based on the evaluations of non existent market values and principles that are static, systemic and provocative for the rural dwellers who have no such intentions to sell their houses.
Who should not pay tenement rates
Tenants, pensioners as occupiers and owners of family houses should not pay tenement rates. But under the Land Use Charge law No 11 of 2001 of Lagos state all land based charges are payable on real properties located in Lagos with each local government council empowered to collect the charges within its jurisdiction as the collecting authority, a function which can be delegated to the state in writing to enable the State make assessments of land use charges and collect same on behalf of the local government councils. Can the local government delegate its constitutional functions to the State? I disagree that this was the intendment of the constitution and may likely lead to a denial of the local governments, their necessary IGR by the state. There is however an important exemption of those not subject to the tenement rates in Lagos which includes pensioners in occupation, and family houses. However tenants are expected to pay tenement rates subject to indemnity from their landlords as occupiers.
Opposition to tenement rates
Opposition to tenement rates are growing and championed by tenants and businesses angry at the excessive taxation, double taxation and corrupt practices of the revenue officials. Elsewhere in Abuja, NEXT LEVEL RESORT dragged the Abuja Municipal Council to court over tenement rates together with the FCDA as 2nd defendants. The plaintiff formulated three issues for determination to it, whether; AMAC is authorized by law to collect tenement rates? The plaintiff also asked the court to determine whether it does not amount to double taxation on NEXT LEVEL RESORT to pay ground rent to FCDA, pay taxes to FIRS, and in addition, pay tenement rates to Abuja municipal council? It also wanted the court to determine whether tenement rates can be paid to AMAC without the inspection to be carried out on the property?
Delivering judgment, DanlamiSenchi J held that by virtue of sections 7, and 303, and 318, and section 1 of the 4th schedule to the constitution, section 55(a):(5)of the local government Act of 1976 and the Abuja Area Council Act of 2001, AMAC is empowered to collect rates for the economic and physical development of the Council and for the provision of basic amenities in the council.
In Port Harcourt, the PHC council has concluded public hearing on a law to check, regulate and control the payment of tenement rates which provides that all owners of houses within Port Harcourt shall pay tenement rates annually as assessed by the Port Harcourt City Government authorized valuer.
However, speaking at the public hearing, the NBA representative OSIMA GINA urged the councilors not to make laws that will infringe on the fundamental rights of the people. In the South- East, protests has only been taken up in organized form by medical practitioners whilst the people groan and revenue collectors grow fat on public grief. The uses of revenue consultants must be discouraged in the backdrop of enabling reforms and fiscal structures of county administrations.
The South Eastern governments need to review the regulations of tenement rates and ensure that vacant houses, pensioner occupied houses and family houses and rural dwellers are exempted from tenement rates There should be a drastic reduction of tenement rates in Areas outside of the capital cities to improve housing development in these areas and arrest rural urban drift. The arbitrariness in the fixing of tenement rates can be checked by regular and physical inspection of the premises to be rated by appropriate valuations.
At the same time, we cannot but affirm the illegality the action of the Lagos state government under the Land Use Charge law No 11 of 2001 of Lagos state, in seeking and accepting the delegation of the function of the Local governments, to collect tenement rates enshrined in the 1999 constitution which empowers the local governments to evaluate and collect tenement rates in the local government Areas as specified in the Schedule of the said constitution.
This is therefore , a violation and rape of our constitution.
The Lagos state government in usurping and performing this important function undermines the autonomy and development of the Local government Areas in the State, not withstanding its good intentions , if any.
Corruption: The World Bank lists of Nigerian looters and the Code of Conduct Tribunal.
The Nigerian public was shocked by the revelations by the World Bank, the apex international Credit and development bank which shows the massive looting of the Nigerian economy in the past decades evidenced by foreign accounts owned by the political class, public officers, and the military with outstanding performances by the erstwhile past heads of states, and the powers behind the emerging political challenges in the country.
I was devastated by the list not only because of the stupendous amount of loot lying in foreign banks and oiling the British economy and other EU nations that has paid lip service to the fight against corruption in Nigeria but also the sheer brazen thievery and primitive acquisition of wealth with its attendant stultification of our economy. It is estimated that over four hundred billion dollars made up of oil revenues, diverted international loans and internally generated revenues has been stolen and or misappropriated, most of which has found its way offshore and lying in foreign Banks.
Today Nigeria ranks as one of the poorest nations in the world, threatened by starvation, instability, unemployment, AIDS, poor health facilities, armed conflicts, energy crisis, health crisis, bombastic insecurity, and a devastating civil war with Islamist terrorists with a deluded leadership that seeks to develop the strongest economy in Africa in the backdrop of the chasm of odouriferous miasma of stifling corruption, failed infrastructures and debilitating energy crisis.
By Barr. Paschal Nwosu