Cape Town considers legal options after High Court ruling on municipal charges
The City might appeal the High Court ruling
Image: Henk Kruger / Independent Newspapers
It was a David versus Goliath battle. A city council determined to milk the middle class property owners with taxes and levies to make its budget balance and ratepayers determined to fight back because the soaring costs. Finally the courts had the last say by determining that certain fixed municipal charges, including those for water, sanitation and city-wide cleaning, should not be linked to property values.
After the Western Cape High Court ruled in favour of the South African Association of Property Owners and AfriForum, the City of Cape Town indicated it was considering whether to appeal the decision.
In its judgment, the court ruled that the City’s 2025/2026 fixed charges for these services were unlawful and invalid, finding that linking tariffs to property value rather than actual consumption was unconstitutional. The court has given the City until 30 June 2026 to remove the charges, creating a significant budgetary challenge for the metro.
The ruling has been widely welcomed by ratepayer groups and several political parties, who describe it as a significant victory for residents and a move toward greater transparency in municipal billing.
Mayor Geordin Hill-Lewis said the City would analyse the judgment in detail and model its potential impact on households before making a final decision on whether to proceed with an appeal.
“The implication of today’s ruling might be that fixed charges go up for many families, and go down for more affluent families,” Hill-Lewis said.
“We will have to carefully consider how best to protect middle and lower-income families going forward.”
The City stressed that the current 2025/26 tariff structure remains unchanged and lawful until 30 June 2026. If the City proceeds with an appeal, the court order will be suspended pending the outcome of that process.
Central to the City’s argument is its cross-subsidisation model, where residents with higher-value properties contribute more toward funding essential services for poorer communities. Hill-Lewis defended the approach, saying it is designed to ensure equitable service delivery across the metro.
“The only alternative is for everyone to pay a flat charge regardless of whether they are low-income or affluent,” he said.
He warned that cutting infrastructure spending, as some critics have proposed, would undermine service delivery and economic growth, describing such a move as “a terrible and indefensible implication.”
The ruling could also result in city-wide cleaning charges being moved back into property rates, potentially increasing the rate-in-rand, despite the City having tabled a 10.2% reduction in the draft 2026/27 budget.
Mayor Geordin Hill-Lewis
Image: Supplied
The Cape Town Collective Ratepayers’ Association welcomed the judgment, saying it confirms that the City acted unlawfully in linking fixed charges to property values.
CTCRA chairperson Bas Zuidberg said the ruling materially affects the draft 2026/27 budget and the fixed charges residents are currently paying or expected to pay in the coming financial year. He called on the City to urgently clarify what impact the judgment will have on the budget.
The organisation has also requested an extension of the public participation period to 15 May 2026, arguing that residents and their representatives need adequate time to assess the judgment and adjust their submissions.
“Allowing the public additional time to review the judgment and its implications would serve the purpose of instilling trust in the democratic principles of public participation,” Zuidberg said.
The Cape Independence Party also welcomed the ruling, describing it as a landmark judgment that confirms long-standing concerns about the City’s tariff structure.
CAPEXIT leader Jack Miller said the decision validates the party’s opposition to what it has characterised as unfair and opaque billing practices.
“The City of Cape Town cannot simply invent new ways to extract more money from ratepayers by dressing up property rates as ‘fixed tariffs,’” Miller said.
The Freedom Front Plus echoed similar sentiments. Councillor Pieter Jansen van Vuuren said the ruling confirms that linking fixed tariffs to property values is both unfair and unconstitutional.
Van Vuuren said tariffs should be based on actual consumption and services rendered rather than property values, arguing that the system effectively amounted to an additional property tax that disproportionately affected working- and middle-class residents already facing rising living costs.
The GOOD Party has taken a more critical stance, calling on the City to abandon any appeal and instead use the ruling as an opportunity to address inequality.
GOOD Secretary-General Brett Herron said the judgment should prompt the City to rethink its approach to tariffs and budgeting.
“The City must stop pretending that it gives a damn about redistributive and social justice, and actually do something real to narrow inequality,” Herron said.
As the City weighs its next move, the outcome of a possible appeal and the modelling of the ruling’s financial impact will be critical in determining how Cape Town balances affordability, service delivery and infrastructure investment.