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Widening the Net

Extending the Property Tax into Previously Untaxed Areas of South Africa

Michael E. Bell and John H. Bowman

Dezembro 2002, inglês

In South Africa, during apartheid, blacks were typically not permitted private ownership of real property, a distinction that is especially important for consideration of the post-apartheid property tax. The democratically elected national government that came into power in 1994 recognized the importance of addressing directly the legacy of apartheid in urban areas. The White Paper on Local Government (p. ix) stated:

Apartheid has fundamentally damaged the spatial, social and economic environments in which people live, work, raise families, and seek to fulfill their aspirations. Local government has a critical role to play in rebuilding local communities and environments, as the basis of a democratic, integrated, prosperous and truly non-racial society.

To address these concerns, the government put in place a two-stage, five-year process of restructuring local governments. Initially producing diversity of local government institutions around the country. The next stage in the local government transformation process was the complete re-demarcation of all local authorities, which reduced the number of authorities, and created a fundamentally new kind of municipality, responsible for several towns and extensive rural areas. This diminished the latitude for local diversity. The amalgamation of municipalities in December 2000 brought new areas into the property tax base. The new municipal structures encompass all land area in South Africa and, as required by law, all land within a local government must be taxed under a system that applies throughout that municipality.

This paper provides the first systematic examination of how areas previously outside the property tax have been brought into it following the municipal amalgamations in 1995 and 2000. We focus on four local governments: in the Eastern Cape Province, George Municipality and the Nelson Mandela Metropolitan Municipality (the last includes the former city of Port Elizabeth); in Gauteng Province, the City of Tshwane Metropolitan Municipality (which includes the former city of Pretoria); and in the North West Province, Moses Kotane Municipality.