Prospects of Site Value Taxation in Nigeria: A Focus on Lagos Metropolis
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Journal of Contemporary Issues in Real Estate
This paper considers the rationale for proposing a Site Value Tax (SVT) for vacant land. SVT is concerned about how land particularly in its undeveloped state can create additional source of income that could add up to GDP growth of a nation. This is an established practice in Australia, Kenya, Jamaica, New Zealand and South Africa amongst others. The paper, in addition to contributing to literature, undertakes a rare and remarkable attempt to study SVT in a growing economy and growing African mega-city with population in excess of 18 million. An in-depth review of literature was explored in addition to interviewing senior officials of the Lagos Land Bureau. A structured interview guide was designed to find out about awareness of excess acquisitions and measures put in place to control or deter excess land acquisitions in the Lagos urban fringe using five-point Likert-type rating scale for determining the perceptions of Land Bureau officials. Findings of study show that Lagos Land Bureau officials were fully aware of excess land acquisitions by developers in the urban fringe of Lagos and affirmed Land Use Act, 1978 is the only policy that have been enacted by government for regulating expanse of land acquisitions, as well as the clause of forfeiture in the allocation letter after two years. None of the officials are aware of SVT as an instrument of control. SVT serves not only as a social purpose but more significantly of economic relevance in acting as a hindrance for unduly large land holdings. Large land holding in itself is not criminal or anti-social but when left in its undeveloped state, may stimulate several unpleasant developments. It was concluded that as a substitute to ground rent which Nigeria currently levy on both developed and bare land, a national Site Value Tax (SVT) deserves consideration as a radical alternative to reducing undeveloped land, steering investors to more productive areas of the economy as well as residential development enhancement. The paper, in addition to contributing to literature, initiates the unexploited concept of SVT as a practical tool required for revenue mobilization in the growing African mega city of Lagos, Nigeria where land is highly valued.
Acquisition , Residential land , Revenue , Site value tax , vacant land
Thontteh, E.O., Ohiro, Y. O. and Osagie, J. U. (2018). Prospects of Site Value Taxation in Nigeria: A Focus on Lagos Metropolis Journal of Contemporary Issues in Real Estate. Vol.4. No. 1