CIAG takes City to Advertising Regulatory Board over false claims of lower rates

The Cape Independence Advocacy Group (CIAG) has formally complained to the Advertising Regulatory Board (ARB), alleging that the City of Cape Town is breaching advertising standards by claiming “Lower rates coming to Cape Town.”

The announcement follows mounting pressure from the public, the courts, civic society, and alternative media, to the City’s unreasonable and unsustainable increases of municipal rates and and arbitrary levies. In an attempt to assuage criticism going into the new municipal elections, they have shaved off a few points of an intermediary increase which does not cause the cost of paying local taxes to go down for any resident.

In its press release today, CIAG argues the City’s promotion is misleading under clause 4.2.1 of the Code of Advertising Practice, which prohibits statements or visuals that are likely to mislead consumers through inaccuracy, omission, ambiguity or exaggeration. CIAG’s analysis of the proposed rates changes shows that most ratepayers, specifically those with properties valued above R550,000, will face increases above the rate of inflation:

The group examined valuations from R500,000 to R10 million and concluded the headline claim does not reflect reality for the majority of homeowners. The detailed calculations were first shared publicly three days ago by CIAG co-founder Phil Craig on X. Craig factored in all four variables published by the City:

•  average property valuation increase of +17.1%
•  rates factor reduced by 10.2%
•  rebate threshold raised to R500,000
•  rebate ceiling extended to R8 million

The resulting table demonstrates percentage increases in annual rates payable that exceed typical inflation for virtually all properties over R550,000 (e.g. around 11% for a R1 million property, tapering to just over 5% for R10 million homes). Craig explicitly invited the public and the City to “sense check our numbers” and noted he had written to the City asking it to verify or dispute the figures.

CIAG says the City responded initially but then sidestepped the question and stopped replying when pressed for clarity. The group describes the increases as part of an ongoing pattern in which law-abiding ratepayers are presented with ever-rising bills that are “politically spun to disguise their true nature and extent.” It further claims these funds are being used, in effect, to subsidise large-scale unlawful land settlements in the Western Cape by economic migrants fleeing governance failures elsewhere in the country.

Craig has emphasised that property rates exist to fund municipal services, not as a tax on unrealised capital gains (already covered by separate capital gains tax). “Rates should increase in line with inflation, not in line with property values,” he stated in follow-up comments.

The ARB will now decide whether to investigate the City’s advertising. CIAG, a non-profit campaigning for democratic independence of the Western Cape, says it will continue to highlight what it calls the true cost of municipal policy to ordinary ratepayers.