Joburg mayor Herman Mashaba announced on Sunday that his administration won’t require property owners to pay rates according to disputed property valuations while objections and appeals are pending.
This follows after the city received 40 000 objections related to new property valuations contained in the 2018 General Valuations Roll that attached new valuations to all properties in the city, totalling about 900 000.
Property owners will start paying property rates in accordance with the new valuations on July 1.
Moneyweb earlier reported that the South African Property Owners’ Association (Sapoa) asked for assurance from the city that it would refrain from charging rates on disputed valuations.
Read: Property rates: Joburg is acting unlawfully, says Sapoa
Many owners reported sharp increases of more than 100% in their valuations and feared that maintaining payments accordingly while waiting for the finalisation of their objections and appeals could bankrupt them.
Sapoa, in a letter to the city, earlier stated that:
- Ratepayers were not liable to pay disputed rates pending the outcome of objections or appeals;
- The city was not entitled to cut off services such as electricity if ratepayers fail to pay the portion of their rates, which they are disputing, nor may it threaten to do so;
- The city was not entitled to claim interest on any shortfall on rates payable by ratepayers on finalisation of objections or appeals.
Sapoa said it was prepared to fight the city in court on these issues.
Mashaba said in a statement on Sunday that “those who have objected to their property valuations, will be allowed to continue paying what they have been paying historically until the objection process is finalised”.
He said the city would ensure no credit management processes would be initiated against objectors, as long as they continue to pay the city the same amounts they used to pay for rates, along with their invoiced service charges.
“Their invoices will still reflect the rates charge on the new valuation, because the law prescribes this,” Mashaba said.
“I believe that this additional effort by the city to support those who feel they have received unfair valuations is an important further step implemented by the city.
“It will mean that in the period of time in which their objection is being handled, these objecting residents will not have to pay the disputed portion of their rates payments.
“A flag will be placed on the accounts with outstanding objection decisions to prevent debt collection action until such time as the objection is resolved. This flag on the account is with respect to the disputed rates account, however the affected account holders will be expected to continue to pay for all other services.
“Once the objection process is finalised, the objecting property owners will be required to make payment with interest, back-dated to July 1 2018, for the valuation arising from the objection outcome,” Mashaba said.
It is not yet clear whether Sapoa will pursue the charging of interest Mashaba refers to, since it differs from its interpretation of the relevant legislation.
Mashaba said the city has received 40 000 (4.4%) objections to the 2018 General Valuations Roll, which included 879 000 properties. “This is worth noting as this is less than half of the 89 000 objections lodged in the 2013 General Valuations Roll.”
Mashaba earlier responded to the outcry about sharp increases in property valuations when he announced that the seemingly “problematic” evaluations of 8 000 properties would immediately be revised.
He further proposed to council to increase the residential rates rebate from R200 000 to R350 000 and the pensioner rebate from R2 million to R2.5 million.