A group, Housing Development Advocacy Network (HDAN), has called on President Bola Tinubu and the National Assembly to incorporate tax relief measures for developers of social housing and building materials in the proposed Nigeria Tax Bill 2024.
In a statement, the group’s Executive Director, Festus Adebayo emphasized that excessive taxation could hinder the delivery of affordable housing, thereby eroding the hopes of millions of Nigerians in dire need of decent shelter.
HDAN specifically advocated for the inclusion of low-income housing tax credits in the new reforms, which would provide a vital incentive to construct or rehabilitate affordable rental housing for low-income households.
Adebayo urged the Federal Government to issue these tax credits through a competitive process, ensuring they benefit those genuinely committed to addressing the nation’s housing crisis.
Nigeria’s housing deficit remains a critical issue, compounded by an estimated population of 224.6 million that is projected to reach 262.6 million by 2030.
With 51.4 per cent of Nigerians classified as multi-dimensionally poor and 58.8per cent per cent of the urban population living in slums, the demand for affordable housing with basic infrastructure is urgent. However, challenges such as high building material costs, exchange rate volatility, and land acquisition issues continue to impede progress in the sector.
HDAN further highlighted the economic pressures affecting housing delivery and how increase in interest rates makes access to affordable mortgages increasingly difficult.
Adebayo stressed that tax reforms should alleviate, rather than exacerbate, these challenges by creating a more supportive fiscal environment for developers of affordable housing.
The Nigeria Tax Bill 2024, currently under deliberation in the National Assembly, has sparked widespread debate. Provisions in the bill, such as the proposed increase in value-added tax (VAT) from 7.5 per cent to 10 per cent by 2025 and eventual hikes to 15 per cent by 2030, have drawn criticism for potentially burdening ordinary Nigerians.
The bill also introduces a 27.5 per cent company tax, a four per cent development levy on companies, and a five per cent excise tax on telecommunications services, among other measures.
HDAN expressed concerns that these tax policies, while aimed at generating revenue, could deter investment in critical sectors like housing unless provisions are made to support social housing initiatives.
The organization also urged lawmakers to consider the significant disparities in housing needs across the country and provide targeted solutions to bridge the gap.
In addition to tax relief, HDAN reiterated its commitment to advocating for the passage of 11 pending housing and mortgage-related bills in the National Assembly.
It called for a review of outdated laws, such as the Land Use Act and Mortgage Bank Act, to create a more enabling environment for private sector participation in housing delivery.
HDAN is a research-driven, non-profit, volunteer, and non-governmental organization dedicated to promoting affordable housing across Africa.
With a membership of over 5,000 professionals spanning various disciplines within the housing and construction industry, HDAN strives to advance sustainable housing solutions throughout the continent.
.
