By Olusegun Emmanuel, Abuja.
(FCT) The senate on Tuesday approved compulsory tax for all houses in Federal Capital Territory exempting only properties owned by Churches and Mosques from payment of the tax.
The senate’s decision was sequel to the consideration of the report of the Joint Committee on Federal Capital Territory and Finance, on the Federal Capital Territory Internal Revenue Board.
The passage of the bill into law will stripe Federal Inland Revenue Services(FIRS) off the duty of collecting taxes in FCT.
The bill will also provide for the establishment of the FCT Internal Revenue Service and other matters connected therewith and also, make provision for assessment, levying and collection of tax on real property within the FCT.
Section 8 of the bill says the service shall have the power to “adopt measures to identify, trace, freeze, confiscate or seize the proceeds of tax fraud or evasion.”
“The Board shall establish and maintain a fund to be applied towards the discharge of its functions which shall consist of and to which shall credit-(1) an amount not more than 10 percent of all revenue by the service in the preceding year as administrative charge or cost of collection…”
A new clause was introduced on imposition and administration of tax on real property. They are property tax, which is payable on all real property situated in designated areas within the FCT.
Section 24, sub section 2 lists those exempted from property tax in the FCT. They are: properties owned by religious bodies; cemetery, especially where it is non-profit making; parks or public square; the diplomatic community since they enjoy diplomatic immunity within the Diplomatic Immunities and Privileges Act; public library; palaces of recognised traditional rulers; non government organisations offering social welfare service, building used for learning and education and also, those used solely for community games or sports.
Moving on, in section 24 (3) (1), the board is empowered to “cause all taxable, real property in the FCT to be appraised at least once in every five years…” and “all taxable property must be appraised at its market value as of January 1 in the year of appraisal.”
The rate of assessment indicates that taxable real property in the FCT would attract the following rates: (a) Residential-0.1 percent; (b) Commercial-0.2 percent; (c) Recreational-0.1 percent; (d) Government and governmental agencies-0.1 percent and (e) Others-0.3 percent.
The tax payable in respect of real property, the bill noted, is from and after January 1 and up to and including December 31 of each calendar year.
Speaking with newsmen after consideration of the report, the sponsored of the bill, Senator Smart Adeyemi said, “With the passage of this bill, the FCT can now generate revenue internally like other states of the federation.
“Again, we are faced with the challenges of the fall in foreign earnings in the country which is affecting various arms of government. So, every level of government must loom inward on how to generate revenue. We have achieved what we wanted to achieve and this will be a turning point for the government of FCT.
“So, this bill is very important and it will help to accelerate the socio-economic development of the FCT. We had some constitutional huddled because FCT in the 1999 constitution was not seen as a state. So, it became a problem as to whether FCT could have a revenue board in place.”