<\/p>\n
Cape Town has expanded rates relief for lower- and middle-income households after a court ruling forced it to scrap tariff structures linked to property values.<\/p>\n
The city has also reopened public comment on amendments to its 2026\/27 budget, which expires on Wednesday, 10 June, ahead of the new financial year starting on 1 July.<\/p>\n
The amendments follow the city\u2019s decision on 22 May not to appeal the ruling that set aside its property value-linked levies and fixed charges.<\/p>\n
Read:
Cape Town accepts court ruling on rates-linked tariffs
Sapoa warns Mangaung: Don\u2019t link tariffs to property value
Court rules Cape Town value-based tariffs and cleaning levy unlawful<\/p>\n
A key effect of the judgment is that Cape Town must revert to using water meter size \u2013 rather than property value bands \u2013 to determine fixed water and sanitation charges.<\/p>\n
The city says this means properties valued below R2.8 million will generally pay more, while higher-value properties will pay less for fixed water and sanitation charges for meters up to 22mm.<\/p>\n
To soften the impact, the city has proposed increasing the rates-free rebate threshold from the first R450 000 of a residential property\u2019s value to R620 000.<\/p>\n
The benefit will apply to all residential properties valued below R8 million, up from R7 million, while indigent benefits will also extend to the higher threshold.<\/p>\n
\nCape Town Mayor Geordin Hill-Lewis says the city is seeking to shield lower- and middle-income households from the impact of the ruling.<\/p>\n<\/blockquote>\n
\u201cThis expanded protection will, on average, offset the rise in fixed charges for most properties under R2.8m due to the court ruling\u2019s impact.\u201d<\/p>\n
The city argues that the court ruling constrains municipalities\u2019 ability to use cross-subsidisation within tariff structures.<\/p>\n
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Read:
Cape Town budget triggers fresh clash over household bills
Cape Town trims rates, caps tariff hikes in latest budget<\/p>\n\u201cThe main impact of the judgment is to limit the ability of the City \u2013 and all municipalities \u2013 to cross-subsidise to protect lower- and middle-income households,\u201d Hill-Lewis says, adding that the city would engage National Treasury on future options.<\/p>\n
City-wide cleaning tariff to be reversed<\/strong><\/p>\n
Cape Town will also reverse changes made in the current budget cycle to fund city-wide cleaning services.<\/p>\n
\nCleaning costs, which had been shifted into a standalone charge for residential customers in 2025\/26, will move back into property rates.<\/p>\n<\/blockquote>\n
As a result, the previously tabled 10.2% reduction in residential property rates will be revised to a 2.09% reduction.<\/p>\n
Read:<\/p>\n
Rising rates rage: Cape Town homeowners push back
More municipalities could see pushback after Cape Town residents\u2019 petition<\/div>\nCourt rules Cape Town value-based tariffs and cleaning levy unlawful<\/div>\nCommercial property rates will also rise, while electricity unit costs for commercial customers will fall due to the phased reduction of the electricity surcharge contribution to city-wide cleaning.<\/p>\n
Residential electricity tariffs will remain unchanged.<\/p>\n
Water and sanitation tariffs<\/strong><\/p>\n
Following the court ruling, fixed water and sanitation charges will once again be based on water meter size.<\/p>\n
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\u201cThis \u2026 means that higher-value properties will pay less fixed charges, while lower-value properties will pay more than they do currently,\u201d the city noted.<\/p>\n
It therefore proposes additional measures to cushion the impact of the return to meter-size charging, including reducing the overall fixed-charge portion of tariffs, consolidating fixed tariffs for the most common meter sizes (22mm) and shifting more costs to higher-consumption users.<\/p>\n
Read: Joburg wants households to pay 66% more to receive water<\/p>\n
Under the proposal, water consumption charges would increase by R2.09 per kilolitre for usage between 10.5kl and 35kl compared with the March budget, and by R8.06 per kilolitre, excluding Vat, for usage above 35kl.<\/p>\n
Similar increases are proposed for sanitation tariffs in those bands.<\/p>\n
No cuts to infrastructure spending\u00a0<\/strong><\/p>\n
The city stresses that the ruling affects only the structure of future charges and not spending plans.<\/p>\n
\nIt says there would be no cuts to expenditure or infrastructure investment under the amended budget, which includes a R40 billion three-year infrastructure programme.<\/p>\n<\/blockquote>\n
The broader budget includes planned spending on water and sanitation upgrades, electricity grid investment, roads, MyCiTi expansion, informal settlement upgrading and housing, alongside a proposed R6.8 billion safety and security budget for 2026\/27.<\/p>\n
Read:<\/p>\n
MyCiTi fares could jump by almost a third from July<\/div>\nCape Town to get electric buses for MyCiTi network<\/div>\nThe city has also reiterated that it will not appeal the court ruling and will instead engage National Treasury and the Department of Cooperative Governance and Traditional Affairs on alternative mechanisms for cross-subsidisation within municipal funding frameworks.<\/p>\n<\/p><\/div>\n
#Cape #Town #widens #household #relief #court #ruling #forces #tariff #rethink<\/p>\n","protected":false},"excerpt":{"rendered":"
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