A kind of “green light patrol” for property rates and taxes may just be needed to prevent the implementation of excessive property rates as provided by the new Municipal Property Rates Act.

The Chairpersons Association (CA) of Makhado (Louis Trichardt) met with property owners on June 29 in the Community Hall in Eltivillas to discuss the impact of the Municipal Property Rates Act (MPRA), No 6 of 2004, the act according to which taxes will be levied in future.

“We as Chairpersons Association are concerned with what the draft rates and taxes have put on the table. We feel that the future taxes and rates are exorbitant, especially in the context of Louis Trichardt. This is a poor area where excessive rates will not be appropriate,” Mr Dave Patel, spokesperson for the CA sub-committee dealing with property rates and taxes, said on Tuesday.

All interested parties are requested to enter into discussions with the steering committee of council on property rates and taxes. There is a process in which parties can participate; interested parties would include all property owners owning property in town, smallholdings or farms, people with knowledge of valuation, property prices or other relevant disciplines.

The CA is adamant that future rates and taxes be negotiated with them.

“When negotiating rates and taxes, we request the municipality to talk to us. We want to participate in the process. We have many different associations affiliated to the CA, like farming associations, and we rally everybody together,” Mr Patel said.

The CA appointed different members to research the nine aspects of the new act, including the interpretation, rating, liability for rates, general valuation of rateable property, valuation criteria, valuation rolls, valuation appeal boards, updating of valuation rolls and miscellaneous matters, including transitional arrangements.

“We want to have a success story, like in Polokwane, where the negotiations on property rates proved successful,” Inga Gilfillan, the secretary of the CA, said.

A training document, drawn up by TAU SA North, shed some light on the new act. According to the Government Gazette, the MPRA was promulgated on 2 July 2005. Before this date, some municipalities implemented property rates according to the provisions of ordinance 11 of 1977. Ordinance 11 of 1977 contained provisions ‘to provide for the levying of rates on rateable property by local authorities’. Most of these efforts proved fruitless and caused unhappiness and concern with affected parties. Some communities went to court to fight the unjust implementation of the ordinance. Some municipalities still experience problems due to the wrong implementation of the ordinance.

“Most municipalities, wisely, decided not to implement ordinance 11 of 1977. Unfortunately, we still find that most officials are badly trained and uninformed and it was mostly junior officials who attended training sessions. It is therefore of utmost importance that each landowner participates in this process. It is your property; become involved and be informed,” reads the document, which also advises all structures to register as stakeholders to participate in the process.

In a budget circular of 2004/5, municipalities are cautioned against extending property taxes in a manner that may impact negatively on the residential, agricultural, mining and industrial sectors. It should be noted that when imposing property rates against any sector or area, the municipality must take account of the services being provided to that sector or area.

Community participation in the process is imperative. Article 4 of the Municipal Property rates Act discusses community participation in detail. The municipality must consult with local communities before council approves the policy and the comments of the community must be taken into account by the municipality.

Before levying any rates, the municipality must formulate the policy, put the valuation process in place and adjust by-laws. The municipal budget must include the provisions of the MPRA. No municipality can levy rates before all the processes are in place.