THE EFFECT OF TAXATION POLICIES ON THE PROPERTY MARKET TRANSACTION IN MINNA
CHAPTER ONE
1.0 INTRODUCTION
- BACKGROUND OF THE STUDY
Property market which can otherwise be called real estate market is defined as any medium where “bundle or clusters of right” are being exchanged. It could also be a system of transaction between land owners, land users and estate agents. It is the sum total of all other smaller and longer markets operating in different types of interest in land. (Olajide, 2012). Real estate transaction can be regarded as the next significant aspect of national development as it forms the physical structure of a nation which the extend and standard of a nation’s development is based (kuya, 2003).prior to the emergency of modern urban development, the traditional African society has been used to the system of ten payment, except that the mode varies from time to time. (Kuya, 2003).
Taxation generally is one of the principle fiscal tools often used by the government at all levels (local, state and national). This government taxing power also provides one of the principal sources of revenue for the finance of public functions. Land and man-made improvements on it has always been subjected to various types of taxes chief of which are tenement rate, capital transfer tax, capital gain tax, probate fee, withholding tax among others(Adegoke, 2003). In its first form, contribution of labor was regarded as “sweat tax” while compulsory contributions from farm produce based on the value of land was regarded as “property tax” and these taxes are used for the maintenance of markets, roads, chiefs palaces, and other public places. Taxes are now in monetary form and can be collected and used for the provision and maintenance of public goods and services. The taxation of land and buildings has undoubtedly been a good source of income which federal, state and local government in Nigeria and other countries have tried to explore over the years.
Different laws and decrees have been used in the past to back up the legal collection of different taxes on landed property. The focus of this research therefore is to examine these taxation policies (laws and decrees) as it affects transactions on land and landed properties.
1.2 STATEMENTS OF THE PROBLEM
The market mechanism of landed property ensures the allocation of land to users and uses. There is the need to introduce orderliness and ensure that publicly desirable uses, which would have been otherwise hedged out by competitions, are able to secure site. These and other factors make the intervention by government in the land allocation mechanism imperative.
Government at all levels over the years have been attempt to regulate property market in different ways such as Land use zoning, sub-division regulation, building codes, power of eminent Domain police power measures and the power of taxation. The problem therefore is that there is no certainty as to what extent does taxation policies affect property market. Required to finance the deficit, Home price and rents on the other hand, have grown ahead of general inflation making matters worse the composition of homes for sale and rent on t he market has been inexorably shifting towards very expensive homes.
Also Kabir and Bustani Ibid state that current scheme include a “site & Service” that provides low-income beneficiaries with serviced plots including tenure Security and help to build their own houses and the second approach helped house-owners in existing squatter area obtain tenure to their land and to improve their dwelling. In spite of the fact that they may help to improve tenure security, these initiate target population low-income earners usually does not benefit from them. Hence, this study is necessitated to assess the effect of taxation policies on the property market operation in Minna, Niger state with the view of point out the impact of these policies in the area to serve as a guideline blue-print and working document for other areas.
1.3 AIM OF THE STUDY
The aim of this research work is to assess the effect of taxation policies on the property market transaction in Minna.
OBJECTIVES OF THE STUDY
To achieve the above stated aim, the following objectives are set:
- To identify the various taxation policies of government policies in Minna, Niger state.
- To identify the property market transactions that are prevalent in the study area.
- To assess the impact of these policies on the property market transactions.
1.4 RESEARCH QUESTIONS
This research therefore is intended to answer the following questions;
- What are the various Taxation policies of government that impinges on property market in Minna?
- What is the impact of these policies on property market?
- What are the issues and changes of these policies as they apply to the transaction of the property market in the area?
1.5 SIGNIFICANCE OF THE STUDY
The study covers the effects of taxation policies on the property market transactions. The potential findings of this study will be beneficial in the following ways:
To the public authorities, it will guide in making appropriate regulations on taxation especially as it affect real property transactions.
To property developers, it will assist them in following appropriate policies to guide their mode of investment and transaction in real property.
The study will also serve as a reference materials for others and researches alike who may wants to carry out further studies on the subject.
1.7 OUTLINE METHODOLOGY
The following research methodologies shall be the employed for this study; Method of data collection, for the success of this research work primary and secondary method of data collection shall be employed.
Sources of data; data for this research work will be sourced through questionnaire and back-up with interview.
Target population; some of the team of expect [valuers] and property developers (investors) in the study area will be considered and sample their opinion on the effect of taxation policies on property market transaction in the study area.
Sampling techniques; in carry at this research work, systematic, stratified and simple random sampling shall be employed
Target population; the target population for this study are estate surveyor and users of property (Banks and mortgage institution in Minna Metropolis).
Method of data analysis; the method data analysis will involve the use of table and frequency details
1.8 SCOPE AND CHALLENGES TO DATA COLLECTION
The scope of this study is limited to effect of taxation policies on property market transaction in Minna metropolis Niger State.
1.9 DEFINITION OF TERMS
property: (encyclopedia) all land, structures, firm attached and integrated equipment [such as light, Fixtures or a well pump], anything growing on the land, and all “interests” in the property which may be the right to future ownership (remainder), right to occupy for a period of time [tenancy or life estate] the right to drill for oil, the high to get the property back [a version] if it’s no longer used for its current purpose [such as use for a hospital, school or city hail], use of air space [condominium] or an easement across another’s property.
Property market: is one of the many varieties of system institutions, procedures, social relations and infrastructures whereby parties engage in exchange goods and services by banter, most markets rely on sellers offering their goods or services [including labor] in exchange for money from layers. It can be said that a market is the process by which the prices of goods and services are established.
Taxation: Taxation refers to the act of taxing authority actually levying tax. Taxation as a term, applies to all types of taxes, from income to gift to estate taxes. It is usually referred to as an act; any revenue collected is usually called “taxes”. Taxation is one of the primary powers of government over the people.
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