Edited by Richard M. Bird and Enid Slack
Chapter 16: Property Taxation in South Africa
Enid Slack1 The population of South Africa is 44 million. The country is organized into nine provinces, six single-tier metropolitan municipalities, 47 district municipalities, and 231 municipalities (within the district municipalities). This new municipal structure came into effect in December 2000 as a result of a major re-demarcation of municipalities and the rationalization and amalgamation of primary-tier urban and rural municipalities into new local municipalities. The property tax (known as ‘rates on property’) is a local tax (provinces are constitutionally prohibited from levying property tax). In metropolitan areas, the metropolitan councils levy and collect property rates; in nonmetropolitan areas, local municipalities levy property taxes. District municipalities may only levy property rates in areas where no local municipality exists (so-called district management areas). Presently, national and provincial governments regulate how the property tax is charged, assessed and collected, however. Within the former white local authorities (before 1993), the property tax was an important tax. Generous rebates were granted to residential taxpayers, shifting much of the burden onto commercial and industrial properties. In contrast, the former black municipalities did not levy property taxes and relied largely on grants from the central government. The absence of a property tax reﬂected apartheid policies that prohibited black landownership outside of the homelands. In 1993, the property tax bases of the former white local authorities were extended to former black local authorities to achieve a uniform structure throughout the jurisdiction of newly established non-racial local government structures. In some black township areas the property tax...
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