IMPACT OF THE PROPERTY RATING BILL ON RATES IN ETHEKWINI
Land - Market Value
Improvements - Replacement cost less physical depreciation.
Residential properties - Composite rate applied to the combined value of land and improvements
(Applies to both free standing residential units as well as Body Corporates)
Flat rate for the poor
Non sewered Sewered
0 - R30 000 Nil Nil
30 001 - 40 000 240 282
40 001 - 50 000 300 352
50 001 - 60 000 360 423
60 001 - 70 000 780 916
70 001 - 80 000 960 1127
80 001 - 90 000 1140 1338
90 001 - 100 000 1380 1620
Other (commercial, vacant land, agricultural property etc.) separate rate randages for land and for improvements
Agricultural land is currently rated as "other" property. A special rebate is applied to all agricultural properties.
This rebate is currently under review.
3.1. Between Residential and Industrial / Commercial
Current ratio of rates income +/- 35 : 65
Values of property:
Residential R54,6 bn
Industrial / commercial R39,7 bn
Current property boom in residential properties could materially impact on this ratio.
3.2. Between affluent areas and poor areas
Significant Rates increases in affluent residential areas.
Reduction in Rates in poor or less affluent areas.
Majority of rural properties will probably fall within the lifeline policy and will pay no rates or low flat rate only.
3.3. COMMERCIAL SECTOR / CBD
New commercial developments - considerably greater rates increases.
CBD values expected to drop, thus rates will drop largely as a result of the degeneration of the inner city core.
Initial challenge is to determine a market value for each of the approximately 450 000 properties in the Metropolitan area of eThekwini. (excluding sectional title units)
Inclusion of sectional title units will increase total number of properties by approximately 100 000. (Total 550 000)
Shifts in the incidence of Rates will be better managed if the property values are reviewed more regularly.
The take-on of the outstanding debts within each Body Corporate will have a considerable impact on administration.
Lifeline policy in respect of residential properties is in terms of a council resolution.
Exemptions in respect of churches, welfare organisations etc. are currently prescribed in terms of the Local Authorities Ordinance.
Exclusions, such as amateur sporting bodies, are in terms of council policy. Applicants are required to complete a questionnaire.
Detailed analysis is conducted on each applicant before exemption is approved.
Welfare organisations and churches, including the manse currently pay no rates. Where part of the premises is hired out for monetary return, this portion is rated.
Council will need to determine future rating policy.
Currently all public service infrastructure is rated other than
Pipes
Cables
Roads
Railway lines