The City of Cape Town in South Africa is heading for another major legal battle as its new tariff structure for water, sanitation, and city cleaning services comes under fresh challenge. Civil society group AfriForum has dragged the metro council to court, joining the South African Property Owners Association (Sapoa) in contesting the legality of linking municipal tariffs to property valuations instead of actual consumption.
The latest case, expected to be heard on 17 and 18 September, will now see two powerful organisations standing against the city government. AfriForum has asked the court to consolidate its application with Sapoa’s, while several other stakeholders including political parties and ratepayers’ associations have already applied to join the Sapoa matter as amici curiae (friends of the court).
At the centre of the dispute is Cape Town’s decision to tie fixed charges for water, sewage, and city-wide cleaning to property values, a move officials say will ensure fairness in distributing the costs of municipal services. Mayor Geordin Hill-Lewis insists the structure is “pro-poor” because it protects the most vulnerable residents while ensuring wealthier property owners carry a larger share of the burden.
But AfriForum and Sapoa believe the system is unconstitutional. In their argument, they say South African law only permits property taxes to be levied under the Municipal Property Rates Act, while municipal service tariffs must be based on consumption. By pegging charges to property valuations, the groups argue, the city is effectively introducing a new tax without proper legal backing.
In court documents, AfriForum asked the judges to declare that Cape Town may not link levies or fees to property values except as prescribed by law. It also wants the court to declare the three tariffs unconstitutional and inconsistent with principles of legality, while suspending the order until June 2026 to give the city time to adjust its financial system. AfriForum further asked that the metro council pay its legal costs.
Despite the tough legal position, AfriForum said it still recognises “the good work the city is doing” but stressed that public interest demands legal intervention. Jurie Ferreira, the organisation’s coordinator for the West Coast District, explained that many residents are already struggling with high living costs, and further increases in municipal rates and taxes could push them over the edge. “This includes the challenges people face daily and the effect the rising cost of living has on them,” Ferreira noted.
AfriForum said it tried everything to persuade city leaders to abandon the plan, including sending representatives from Gauteng to Cape Town for direct talks with Mayor Hill-Lewis. When the council refused to change course, the organisation decided to seek legal relief.
Meanwhile, Sapoa’s case has drawn strong backing from the Cape Town Collective Ratepayers’ Association (CTCRA), which represents 57 smaller associations across the city. The CTCRA says the new charges severely hurt middle-class homeowners who cannot pass on higher bills through rent, service fees, or product pricing like businesses can. The group insists that the impact on residential ratepayers may be even more severe than on commercial property owners.
The CTCRA also rejected Hill-Lewis’ claim that Sapoa represents only wealthy businessmen seeking to avoid responsibility. Instead, it stressed that thousands of ordinary residents had objected to both versions of the budget but were ignored by city officials. It argued that the city could find alternative ways to balance its budget, such as cutting costs or boosting efficiency, rather than passing the burden onto residents through tariffs tied to property values.
The September hearing is expected to draw nationwide attention because Cape Town, often praised for its financial management compared to other South African cities, could be forced to overhaul its revenue model if the courts rule against it. If the tariffs are declared invalid, the city may need to explore new revenue streams or revise its budget plans to maintain essential services.
For now, residents remain caught between government’s attempt to restructure municipal finances and the legal fight over what is fair, lawful, and sustainable. The outcome of this case could set an important precedent not just for Cape Town but also for other municipalities across South Africa considering similar revenue models.
