R8.3 Billion in Rates and Tariff Relief

The City of Cape Town has made some R8.3 billion available in rates and services relief in the City of Hope 2026/27 draft budget to help qualifying residents.

In addition to the R8,3 billion proposed in rates and services relief, around 60% of homes are set to get a property rates decrease or no change in rates at all, even though the latest general valuation showed strong property value growth for homeowners.

Property Rates and Tariffs

• Around 60% of homes are set to get a property rates decrease or no change in rates at all, even though the latest general valuation showed strong property value growth for homeowners in Cape Town.
• This is due to special measures to help ratepayers’ pockets, including a proposed 10,2% lowering of the property rates formula (known as the “rate-in-rand”). The first R500 000 of property value will also be rates-free (up from R450 000), and this will now apply to all homes up to R8 million (up from R7m).
• Other measures include a proposed raising of indigent relief thresholds – already SA’s widest. This includes a 100% rebate for water and sanitation, as well as City-wide cleaning, for properties valued up to R620 000 (both up from R500 000), and a 100% rebate for refuse collection for properties valued up to R580 000 (up from R450 000).
• Tweaks have also been made to property value bands for fixed charges to mitigate the number of properties moving between bands due to the General Valuation.
• More pensioners and social grant recipients will benefit from rates rebates and Lifeline electricity due to the raised upper qualifying limit in 2025/26, from R22 000 to R27 000 total monthly household income, regardless of property value; South Africa’s highest threshold.

The City reminds its pensioner and social grant recipients they need to reapply for their benefits due to the new general valuation.

Rates and tariff proposals from 1 July 2026:

• Property rates: varies due to general valuation – a 10,2% reduction in the rate-in-the-rand
• Water and sanitation: 4,5%
• Refuse collection: 3,75%
• City-wide cleaning: 3,75%
• Electricity: 6,67% on average (2,34 percentage points lower than the Eskom increase to municipalities. Increase due to the National Energy Regulator’s approval of the Eskom increase. Some 70% of the City’s tariff income goes to buying bulk electricity from Eskom).

Special protection for Lifeline electricity customers also continues in the coming financial year.

• In 2023/24, the City raised the number of units that Lifeline customers can buy at a cheaper, subsidised rate, from 350 to 600 units per month.
• In 2024/25, the City went further, to allow purchases over 600 units at the same cheaper rate (households required to stay within a 450-unit monthly average over 12 months to stay on Lifeline).

Please see: https://bit.ly/3PTgvAu  for information on the rates and tariff relief as well as the average tariffs proposed for 2026/2027.