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.
The court declared the levies unlawful and invalid, giving the city until 30 June 2026 to remove them.
The ruling follows a protracted battle between the South African Property Owners Association (SAPOA), the Cape Town Collective Ratepayers’ Association (CTCRA), Afriforum and the City of Cape Town.
The legal storm erupted over three tariffs introduced in the CoCT’s 2025 budget, specifically the city-wide cleaning tariff, fixed water tariff, and fixed sanitation tariff.
The cleaning tariff was aimed at maintaining the cleanliness of public spaces in the city.
It is not linked to any municipal services consumed at the property, but rather calculated based on the property’s municipal valuation.
The fixed water and sanitation tariffs were new fees charged on bills regardless of consumption levels on properties.
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.
However, the CoCT’s fixed fees differed again, as they were based on a property’s value, not consumption.
This meant that while residents were being charged new levies, they were not receiving any additional services, which drew fierce opposition.
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.
Following its successful bid to overturn another unlawful city cleaning levy in Tshwane—a case ironically supported by the DA, which leads the City of Cape Town—AfriForum joined the fray.
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.
It said the charges were rational, and part of its constitutional mandate to provide municipal services, and did not amount to unfair discrimination.
They were necessary to guarantee certainty and predictability in revenue streams to facilitate infrastructure development, it said.
However, the High Court ultimately ruled in favour of the applicants, declaring the City of Cape Town’s model unlawful and invalid.
Rates need to be based on consumption
According to Afriforum, the High Court’s ruling confirmed that municipal services may only be charged in proportion to their actual use.
“This ruling confirms the core equitable principle of charging for services based on use,” it said.
The court’s ruling stressed that municipalities do not have unlimited and unconstrained power to levy charges on residents.
“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.
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.
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.
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.
“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.
“The exercise of this power and the imposition of the charges are consequently unlawful and invalid.”
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.
The full ruling can be read below:
