New municipal tax is described as unethcal'

THE Independent Schools Association of South Africa has described the move by the eThekwini municipality to categorise private schools as commercial and businesses as "unethical".

The municipality has re-leased a statement informing the public about a new law, which states that private schools are now eligible to pay rates.

Isasa deputy chairperson Henry Bennett said they were also considering legal action.

"In principle we believe that no school should have to pay rates, whether public or private, because education is a national priority affecting the national economic policy."

Bennett said since schools were now required to pay rates the municipality should take into account that the majority of schools were not for profit but public benefit organisations and charge on that basis.

He also questioned the rebate offered by the municipality and said the schools would end up paying more.

According to eThekwini municipality the new law states that the schools are regarded as newly rateable and the rates are phased in over a period of four years.

A 100percent rebate was granted in the year 2008-09 and 87,5percent granted for 2009-10.

In the following financial year the schools would receive a 50percent rebate, the statement said.

Bennett rejected this saying: "One cannot be given a rebate after not having paid rates and taxes before. This is the phasing in for properties.

"In years to come, schools will be paying more than they had anticipated," he said.

Bennett said they had challenged the municipality nationally. They had also lodged complaints with the Department of Co-operative Governance and Traditional Affairs and the SA Local Government Association.

He said discussions that have taken place with the two entities had been positive and he was sure a resolution would be found.

"If we do win our case the municipality will be required to lower the rates taxes to public benefiting organisation," he said.