Property rates are charged at a significantly higher rate (sometimes even 4.5 times higher) on vacant stands than on ordinary, residential properties. The reason for this is to motivate the landowner to develop the land and to obtain utilities (e.g. water and electricity) from the city council. When the former Kungwini Municipality merged with City of Tshwane Metropolitan Municipality in 2012, the City of Tshwane re-categorised several properties, which had formerly been classified as residential properties, as vacant stands. This process had the effect that numerous property received excessive rates accounts. Further, the new rates were applied retrospectively from July 2011. The owners did not have the opportunity to object to the re-categorisation and were forced to pay the new accounts to avoid their services being cut off.
The High Court held that the process was unlawful, and therefore invalid, since City of Tshwane did not follow the correct procedures. The re-categorising of the properties occurred without the owners being given proper notice. The Supreme Court of Appeal recently (31 May 2018) upheld the High Court’s decision. The City of Tshwane is now tasked with making significant changes to the accounts of the affected persons.
