Saturday, March 20, 2010

Tax revolt a 'recipe for anarchy'

The Kannaland and Beaufort West municipalities are part of a string of councils countrywide where ratepayers withhold taxes - a move one council's mayor says is a recipe for anarchy in the country.

The two municipalities are also among several towns in the Western Cape where ratepayer groups had filed disputes about issues such as poor service and financial accountability.

Other towns include Ladismith and Tulbagh. Nationally rates are being withheld in 24 towns.

Co-operative Governance and Traditional Affairs Minister Sicelo Shiceka said recently about 280 "white" ratepayer groups had created a "parallel government" by keeping in trust accounts monies owed to councils. It undermined municipalities' ability to deliver services, Shiceka said.

Beaufort West and Kannaland are jointly owed about R600 000.

Louis Reynolds, spokesman for Rural Ratepayers Association which presents 190 farm owners in the Beaufort West area, said property rates had increased up to 700 percent since July while the municipality did not provide a service to farmers.

"We are too far from town. Our dispute is about high taxes. We are willing to pay taxes, but not such exorbitantly high amounts," Reynolds said.

The average rate was difficult to calculate because rates were determined according to the value of the land, he said.

"The rate is R11 000 per R1 million of land value," Reynolds said and added that land was valuable, but it did not generate a huge income.

"Farmers struggle with drought. They don't make much money, but face high rates. They need protection. We are in discussion with the municipality to find a solution. We have to preserve farmers and food production. It is a matter of survival. Northern Cape has the same problem," he said.

Reynolds would not disclose the amount withheld, but Beaufort West municipal manager Jafta Booysen said it was about R500 000.

"In terms of the Act you can't register a dispute if your rates account is wrong. Just before we went to court last year they wanted to resolve the issue and we engaged them. We said we want all the money plus interest," Booysen said.

Rates from farms constituted 2,9 percent of all municipal rates collected and was less than one percent of the council's total revenue, he said.

"We told them they should contribute to our legal costs. They have already paid R40 000," Booysen said.

In Kannaland, mayor Nicolaas Valentyn said they initiated legal action against Kannaland Taxpayers Union for withholding about R95 000.

"That is a lot of money. If rates are kept from municipalities it could lead to disaster in the country."

KTU had withheld rates in Calitzdorp since last year.

The group had complained about four water leaks, but only one was brought to the municipality's attention, Valentyn said.

"We won't know of leaks if we are not informed. Calitzdorp has no serious problems with services. We want to improve the whole Kannaland, not just Calitzdorp. I'm told that about 90 percent of KTU members are white. I'm no racist, but white people doing this (withholding rates) must start accepting municipalities controlled by coloured and black people. We need to work together. We may not act against them (KTU), but will against individuals because no services are withheld," Valentyn said.

About the interest generated from the money held in a trust, he said: "That must also be a lot and we want it."

KTU spokesman, Hennie Smit was pleased water leaks had been fixed recently, but questioned why it took a "crisis" before the council acted.

He alleged the council could not account for water and electricity it sold.

"The municipality buys water for a certain amount, but can't account for how much it sells the water. This means they can't manage their accounts. The same happens with electricity. Better management of accounts means better management of tariffs.

"The municipality must be careful about legal action because its records are not that good. I'm an individual they wanted to charge, but they withdrew because their evidence was very weak. This is the general problem. The municipality records are so messed up it won't be able to put its case in court," Smit said.

While negotiations were under way to resolve the dispute, rates are kept in trust with a Oudtshoorn lawyer. "One thing that must be clear. We are responsible ratepayers. It is not that we do not want to pay. A year ago we put in writing to the municipality what was wrong. That is a very long time," Smit said.

He said the interest derived from taxes withheld would not be paid over, but the KTU would negotiate with the council on how to spend it.

About Smit's allegation of poor accounting, Valentyn fired back, saying: "He talks rubbish. All ratepayers get a monthly account stipulating what is charged. We have budget meetings the community attend. If he has a problem he should raise it there. KTU sits in on council meetings. If they see a problem, why not raise it after the sitting? The real issue is that they don't
want to pay.

They must understand that Kannaland is a total
community."

Local Government MEC Anton Bredell said he empathised with people who did not pay, but it was illegal to withhold money owed to a municipality. He said effective communication between council and ratepayer associations was needed.

"They should ... discuss problems. If you withhold your rates and taxes because the water in the taps are dirty then the municipality does not have enough money to improve on water delivery. Also, with what money will the municipality pay its employees if taxes are withheld?" he said.

From Cape Times, 18 March 2010

3 Opinion(s):

Anonymous said...

We want de munnie. We want, we want, we want...Africa's international song.

Islandshark said...

Undermined ability to deliver services? What services?

Another mud-hut dweller not comprehending the simple principle of delivering something for getting paid for it.

My question is this - why only 24 towns? No white person in SA should be paying anything to municipalities. Let us see how long they last without whitey. My prediction - three months at most.

Jim Beam said...

This is an old point which has come up before under a different banner. Farmers used to pay very low rates when it came to rates and taxes as many don't have bulk services or any infrastructure which the muncipalities would have to service or install. The main roads which was pointed out actually is built and serviced by central governments road fund not the muncipality.

So why do farmers or anyone in a remote location pay any rates and taxes - simply because the law says so. Not to long ago the Minister of Agriculture pointed out that there are many farms being converted into golf courses. She is so blind and dumb that it had not struck her that if you own a farm you pay rates and taxes but anything linked to tourism such as golf courses are exempt from rates and taxes.

If you want to see something stupid look at the rates and taxes farmers have to pay annually for a shithole like Carnavon where there is ZERO infrastructure.