Pretoria - Well-to-do communities countrywide which are unhappy about the property rates they pay to municipalities could benefit from the legal principles established on Friday in the North Gauteng High Court in Pretoria.
This is according to Derek le Roux, chairperson of the Silver Lakes Homeowners' Association, which has reached a settlement with the Kungwini Municipality in Bronkhorstspruit on behalf of the residents of Silver Lakes and the surrounding communities.
This settlement has been made an order of court and, according to Len Dekker, the attorney representing the residents, it offers a better solution for such communities than the withholding of rates - as per the Sannieshof model.
Silver Lakes, Mooikloof and other surrounding communities, known as the Kungwini West Alliance (KWA), are situated to the east of Pretoria but fall within the borders of Kungwini.
These predominantly affluent areas have previously veen heavily taxed by Kungwini and reportedly provide some two-thirds of the municipality's property tax revenue.
The communities were previously also successful when the Appeal Court set aside their high rates for the 2004/05 financial year.
But they had also submitted a court application for the subsequent two years' property taxes. This application had been pending, but was withdrawn on Friday's settlement.
According to the settlement, those two years' rates were reduced by 10%.
Credit
Taxpayers who have already paid their taxes in terms of the higher tariffs and still have current accounts with Kungwini are, according to Le Roux, now entitled to a credit.
Residents of Kungwini West who have not paid the three financial years' taxes, in anticipation of the court's decision, in terms of the settlement now come into consideration for an incentive scheme offering a 30% discount to those in arrears if the account is fully paid up by February 12 2010, even though the scheme's deadline actually expired in November.
The municipality is also obliged to consult the KWA on its annual budget, its integrated development plan and its property rates policy.
Dekker says that although consultation is prescribed by municipal laws the settlement now places the onus on the municipality to consult this particular community, and failure to do so will constitute contempt of court.
The final groundbreaking clause is that at least 30% of the annual property tax revenue from these communities has to be spent within the same communities - on projects identified during consultation.
Le Roux says the communities have never had a problem with contributing to service delivery in poorer parts of the community but, because of the rapid expansion in their environment, their own infrastructure also needs upgrading.
There are of course impoverished residents in the direct vicinity, such as in the LNJ squatter camp, who are in dire need of service delivery.
Le Roux says the KWA will encourage its members to pay their property taxes dutifully.
This settlement is, according to Dekker, a better option than that adopted by Sannieshof and other towns countrywide, which is to withhold property tax in protest against deficient service delivery in their communities.
He explains that withholding tax prevents one from selling one's property because one cannot then receive a clearance certificate.
He reckons that the settlement represents a win-win solution for all parties within a legally enforceable framework.
- Sake24.com
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