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Property Rates Are Decreasing In Cape Town - Relative To Other Cities In South Africa

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Property Rates Are Decreasing In Cape Town - Relative To Other Cities In South Africa

According to Businesstech, while property rates will be stretching pockets even further across the country, with an average increase of 5%, Cape Town homeowners will be the only ones to see a decrease of 1.1%.

Municipal property rates are calculated by multiplying the market value of the property - as reflected in the valuation roll - by a cent amount in the rand rate that a municipal council has determined. This means that if your property's value remained unchanged after the GVR, you still must pay the determined annual increase of the municipal rates.

For example, if your property's value remained unchanged, Joburg homeowners would still have to pay a 5.3% increase, Tshwane (5%), and eThekini a considerable 8.9%.

The amount of tax you pay is influenced by various factors, including the statutory R15,000 exemption applicable to all properties as per the Municipal Property Rates Act and any rebate determined by the property rates policy of your municipality.

For the 2023/24 financial year, the City of Johannesburg has reduced its rebate by R50,000, adjusting it from R335,000 to R285,000. Currently, homeowners in 2022/23 do not pay tax on the first R350,000, which includes the statutory R15,000 exemption.

On the other hand, Cape Town homeowners will be the only South Africans to experience an increase in these exceptions and rebates. Starting from July 1st, the rebate for all properties valued under R5 million will rise from R285,000 to R435,000, representing a significant 52% increase. This is in addition to the statutory R15,000 exemption for all properties, which means the first R450,000 of those residential properties' values will be exempt from tax.

According to the City, more than 80% (740 000 residential properties) of the total rateable properties of 909 000 in the GVR2022 qualify for rates relief. It forms part of a General Valuation policy package and according to Cape Town's mayor Geordin Hill-Lewis, the measures aim to ease the pressure on households due to the rising cost of living. Homes worth over R5m will pay R147 more for rates per month.

Johannesburg

Property value

2023

2024 (from 1 July 2023)

Change

R800 000

R323

R378

+R55

R1 000 000

R467

R529

+R63

R1 400 000

R754

R832

+R78

R1 800 000

R1 041

R1 135

+R93

Durban - eThekwini

Property value

2023

2024 (from 1 July 2023)

Change

R800 000

R671

R730

+R59

R1 000 000

R868

R945

+R77

R1 400 000

R1 262

R1 375

+R113

R1 800 000

R1 657

R1 805

+R148

Cape Town

Property value

2023

2024 (from 1 July 2023)

Change

R800 000

R264

R183

-R81

R1 000 000

R370

R288

-R82

R1 400 000

R582

R497

-R85

R1 800 000

R793

R706

-R87

Author Businesstech / Benhard Wiese
Published 09 Jun 2023 / Views -
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