GVR Matters, Municipal Matters
GVR: Does a general valuation roll ever close?
Do General Valuation Rolls Ever Truly Close?
Originally produced and published by HBG Schindlers Attorneys.
This article explores whether a general valuation roll (GV) can ever be considered “closed,” making it impossible to lodge objections to its information after the commencement of a subsequent GV.
Why This Matters
Property owners and other stakeholders often discover errors in property valuations or categorizations long after a GV period has passed and a new roll has begun. Municipalities typically treat the prior GV as “closed,” refusing to accept objections. This practice can lead to significant financial consequences for owners unable to correct overvaluations or incorrect categorization.
Legal Framework
The Local Government: Municipal Property Rates Act No. 6 of 2004 (“the Act”) governs property valuations. While the Act envisions GVs as enduring for 4–5 years, with tax rates adjusted annually for inflation, it also permits exceptions where valuations or categorizations can be revisited.
These exceptions include:
- Subdivision, consolidation, or demolition of properties.
- Historical undervaluations.
- Exceptional reasons necessitating revaluation.
The Act prescribes that the valuation and categorization on a GV should apply for its entire duration unless corrected through these limited exceptions.
Does a GV Ever Close?
Municipalities generally consider a GV “closed” once the next GV begins. However, this practice lacks legal basis. South African law does not explicitly prescribe that GVs must close. Instead, two notable exceptions allow disputes after the “closure” of a GV:
- Pending Disputes: If a dispute was lodged before the GV “closed” but resolved afterward, the amended valuation applies retroactively for the GV’s duration.
- Supplementary Valuation Rolls (SVs): Municipalities often publish final SVs after a GV period ends, enabling disputes to address issues retrospectively.
The Act requires at least one SV annually, but municipalities may issue additional SVs as needed. A final SV, published after a GV’s conclusion, provides a legal avenue for addressing valuation errors.
Challenging a “Closed” GV
To dispute information on a previous GV, a new SV must include the property in question. Property owners can submit a Section 78 query requesting the municipality to include their property in the next SV. However, no legal obligation exists for the municipality to act on such queries.
If the property does not appear on the next SV, owners can still lodge objections, citing errors or omissions on the roll. Municipalities typically process these objections, even if the property isn’t explicitly listed.
Retrospective Application of Adjustments
The Act permits retrospective application of reduced valuations to the commencement date of the GV or the purchase date of the property, whichever is later. However, this provision has only applied to reduced valuations since 1 July 2015. Adjustments to categorization, however, have always been applied retrospectively.
For example, if an SV were opened today for the 2008 GV, reductions in valuation or corrections in categorization could be backdated to the 2008 GV period.
Practical Challenges
Municipalities often resist reopening GVs due to concerns about floodgates of objections and budgetary constraints. Forcing a municipality to publish a fresh SV, particularly for older GVs, may require legal action. A court order might be necessary to compel the municipality to act, either as an interdict or a review of the decision not to issue a new SV.
Conclusion
While municipalities commonly treat GVs as “closed” after the commencement of a new roll, the Act does not legally mandate this practice. Property owners have options to address valuation errors through Section 78 queries, SV objections, and, if necessary, legal action. However, municipalities are likely to resist such challenges, necessitating a clear understanding of the legal processes and potential court intervention.