{"id":858893,"date":"2026-04-30T17:02:26","date_gmt":"2026-04-30T15:02:26","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=858893"},"modified":"2026-04-30T17:04:03","modified_gmt":"2026-04-30T15:04:03","slug":"huge-rates-and-taxes-win-for-cape-town-residents","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/government\/858893\/huge-rates-and-taxes-win-for-cape-town-residents\/","title":{"rendered":"Huge win for anyone who owns property in Cape Town"},"content":{"rendered":"\n

The Western Cape High Court has struck down the City of Cape Town’s controversial rates and taxes tied to property value instead of consumption.<\/p>\n\n\n\n

The court declared the levies unlawful and invalid, giving the city until 30 June 2026 to remove them.<\/p>\n\n\n\n

The ruling follows a protracted battle between the South African Property Owners Association (SAPOA), the Cape Town Collective Ratepayers\u2019 Association (CTCRA), Afriforum and the City of Cape Town.<\/p>\n\n\n\n

The legal storm erupted over three tariffs introduced in the CoCT\u2019s 2025 budget, specifically the city-wide cleaning tariff, fixed water tariff, and fixed sanitation tariff.<\/p>\n\n\n\n

The cleaning tariff was aimed at maintaining the cleanliness of public spaces in the city.<\/p>\n\n\n\n

It is not linked to any municipal services consumed at the property, but rather calculated based on the property’s municipal valuation.<\/p>\n\n\n\n

The fixed water and sanitation tariffs were new fees charged on bills regardless of consumption levels on properties.<\/p>\n\n\n\n

These are similar to various capacity charges and fixed fees charged for electricity, which have also drawn the ire of residents in many other cities.<\/p>\n\n\n\n

However, the CoCT\u2019s fixed fees differed again, as they were based on a property\u2019s value, not consumption.<\/p>\n\n\n\n

This meant that while residents were being charged new levies, they were not receiving any additional services, which drew fierce opposition.<\/p>\n\n\n\n

SAPOA launched its High Court application in July 2025, seeking to have the levies removed. The CTCRA applied to join proceedings as a friend of the court.<\/p>\n\n\n\n

Following its successful bid to overturn another unlawful city cleaning levy in Tshwane\u2014a case ironically supported by the DA, which leads the City of Cape Town\u2014AfriForum joined the fray.<\/p>\n\n\n\n

The City of Cape Town opposed the applications, arguing that its models and tariffs were in line with the Constitution, national legislation and the city’s by-laws.<\/p>\n\n\n\n

It said the charges were rational, and part of its constitutional mandate to provide municipal services, and did not amount to unfair discrimination. <\/p>\n\n\n\n

They were necessary to guarantee certainty and predictability in revenue streams to facilitate infrastructure development, it said.<\/p>\n\n\n\n

However, the High Court ultimately ruled in favour of the applicants, declaring the City of Cape Town’s model unlawful and invalid.<\/p>\n\n\n\n

Rates need to be based on consumption<\/h2>\n\n\n\n
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Cape Town Executive Mayor, Geordin Hill-Lewis<\/figcaption><\/figure>\n\n\n\n

According to Afriforum, the High Court’s ruling confirmed that municipal services may only be charged in proportion to their actual use.<\/p>\n\n\n\n

“This ruling confirms the core equitable principle of charging for services based on use,” it said. <\/p>\n\n\n\n

The court’s ruling stressed that municipalities do not have unlimited and unconstrained power to levy charges on residents.<\/p>\n\n\n\n

“Where the charges are necessary or desirable, or ensure an equitable or appropriate contribution to infrastructural services…does not resolve whether they are lawful,” it said.<\/p>\n\n\n\n

While the court acknowledged that the City has an obligation to expand infrastructure development and ensure service delivery across the city, it said it must do so legally.<\/p>\n\n\n\n

The court said the imposition of the three charges in question does not amount to a “lawful charge for a service provided” in terms of the cited laws.<\/p>\n\n\n\n

The court was also not convinced that CoCT’s current funding structures, which allow charges to be levied on ratepayers based on consumption, impede its revenue collection efforts.<\/p>\n\n\n\n

“The imposition of the charges has resulted in [the City] unlawfully assuming a power not granted to it by the Constitution or legislation,” it said.<\/p>\n\n\n\n

“The exercise of this power and the imposition of the charges are consequently unlawful and invalid.”<\/p>\n\n\n\n

In terms of the ruling, the City of Cape Town’s tariff model will be set aside from 30 June 2026. It was also ordered to pay costs.<\/p>\n\n\n\n

The full ruling can be read below:<\/p>\n\n\n\n