A group of concerned rural land owners in Bitou have questioned the municipality's proposed rates hikes which, they said, could mean increases of more than 200% on certain properties.

According to the group, the municipality's new rates system indicates that rural land owners who farm on their land will only see a 5% rates increase.

However, owners who use the land for other than agricultural purposes will see a 264% increase in rates, even if they qualify for a 75% rebate.

But the municipality says the land owners have the figures incorrect. They say the increases are being put in place to encourage farming activity on agricultural land and agricultural land owners have received fair treatment from the municipality regarding rates.

The Bitou Rural Action Group (Brag), a lobby group, is seeking clarity on the methodology used for the valuation of land and how levies, for the purpose of collecting rates, are calculated.

Brag spokesman Rikus Truter said: "For the forthcoming financial year of 2007/2008, bona fide farmers on agricultural land will be able to apply for a 90% rebate, commensurate with an increase in rates of 5%.

"For owners of agricultural land not engaged solely in agricultural activities, application for a rebate of 75% can be sought; but if granted, this will nevertheless bring about an increase of 262% in rates payable."

Brag claims there is no absolute definition of what constitutes bona fide farming and agricultural activity, and has engaged legal counsel to pursue the matter.

A letter of objection is to be sent to the municipality before the beginning of July, which is when the action group believes the new rateable values of land will be implemented.

Former Bitou mayor Euan Wildeman, who presently serves as a councillor with the municipality, said the projected increase of 262% that had been touted by the action group was incorrect.

Wildeman said currently land owners using their land for farming were paying 1,4c per rand on the land before any rebate. Before a rebate, housing on farm land would see a rate of 0,77c in the rand.

After the 5% increase, the rates for land, before a 90% rebate, would be 1,5c in the rand and for buildings it would be 0,81c in the rand.

"The annual increase of 5%, due to be introduced next month, means that farmers will be paying 0,15c and 0,08c cents in the rand for land and buildings respectively, after receiving a rebate of 90% from the municipality. The overall increase remains at 5%," Wildeman said.

He said that on agricultural land not used for farming, the full levy on rates remained 1,5c for land and 0,81c for housing, and a rebate of 75% could be applied for. "Together with the annual increase of 5%, the net result, arising from the compounding effect of multiplication, is an increment of 162% from one year to the next - not 262%."

For a farm that has land valued at R3-million and a house worth R850 000, the increase of 162% would be equivalent to R669,75 - rising from R410,83 to R1 080,58.

Up until now in Bitou, owners of agricultural land not put to use for farming, have enjoyed a rebate of 90%.

Municipal acting chief financial officer Johan Coetzee said: "The issue is not the provision of services. People living in the town of Plettenberg Bay receive a rebate of 40% on rates, but pay in full for the provision of services such as water, rubbish removal and sewerage. Those living on agricultural land do not receive municipal services, nor do they have to pay for them."

Wildeman said: "We want farmers to produce crops and foodstuffs for the benefit of the local economy."

Eastern Province Herald