The City of Cape Town will analyse the judgment and consider its options for appeal following the Western Cape High Court’s ruling that certain fixed charges should not be linked to property value for the coming new financial year starting on 1 July 2026. The order will however, be suspended should the City appeal. In considering its legal options, the City will also model the ruling’s potential impact on ratepayers, especially lower and middle-income households. The ruling does not change the current 2025/26 tariff structure and budget, which remain lawful and applicable until 30 June 2026.
‘It remains my firm belief that Cape Town cannot truly work unless it works for everyone. Every resident from every community depends on a future where everyone has access to basic services and infrastructure that creates opportunity for jobs and growth. Cross-subsidising – where the better off among us help to fund services for the less fortunate – is the most equitable and sustainable way to ensure a working city of hope for all.
‘The point of using property values to determine fixed charges is to protect lower and middle- income homes. The only alternative to this is for everyone to pay a flat charge regardless of whether they are low-income or affluent.
‘The implication of today’s ruling might be that fixed charges go up for many families, and go down for more affluent families. That is the perverse implication of this ruling, and why we will have to carefully consider how best to protect middle and lower income families going forward.
‘The only other option would be to cut our infrastructure budget – I see already that the organisation StopCOCT is arguing for precisely that. This would lead to a less functional city with less basic dignity for residents – a terrible and indefensible implication. We do not agree with this course of action at all. Investing in infrastructure is the core of what makes a city work for all, and a growing economy.
‘The City will carefully model the potential impact of this ruling on lower and middle-income households – who we will keep striving to protect,’ said Mayor Geordin Hill-Lewis.
The Mayor further noted that throughout the process, SAPOA and Afriforum both acknowledged that Cape Town is a well-run metro and accepted the necessity of the City’s infrastructure budget.
Ruling would see City-wide cleaning moved back into Property Rates
The implication of the ruling – if not appealed – is that City-wide cleaning charges are moved back into the property rates account rather than being charged as a tariff, which would entail an increase to the proposed rate-in-rand. As it stands, the City has tabled a 10,2% reduction in the rate-in-rand in the draft 2026/27 budget.
Importantly, the city-wide cleaning charge does not raise new revenue and the service still requires funding notwithstanding the ruling on how it is charged for. Residents have always contributed to this service, inter alia, via electricity purchases. From 2025/26, City-wide cleaning was simply removed from electricity, lowering prices, and displayed separately on the monthly bill. In this way, waste management became a self-funding service with ring-fenced revenue.
Cape Town’s reforms are in line with National Treasury’s reform programme, which has already released over R400m in incentivised grant-funding to Cape Town. This is part of a multi-billion rand funding pipeline in the coming years, thanks to the City’s sustainable water, sanitation, electricity and waste services.
This is in contrast to Tshwane’s ‘cleansing’ levy, which sought to raise new revenue and was not linked to any services rendered (around 250 000 households and businesses in Tshwane use private refuse removal contractors because the City doesn’t have the capacity to provide this service).
