The City of Cape Town is offering guest houses and B&Bs the option of changing their property status classification in an effort to lessen the financial burden of the impact of COVID-19.
In accordance with the City’s rates policy, guesthouses and certain B&Bs are classified as business properties and are thus liable for higher municipal rates.
The City said it was aware that the hospitality industry was suffering loss of business due to the nationwide lockdown and, as such, has provided options for accommodation establishments to alleviate their financial pressures.
- Continuing to operate without change of classification. Should the account fall into arrears payment arrangements can be applied for.
- Cease operations and apply for reclassification of the property as a residential property, meaning it can no longer operate as a guesthouse or B&B but the rates will be reduced and service-related tariffs and charges will be amended accordingly.
- Or reduce the extent of the business so that the property is predominantly used for residential purposes and apply for reclassification of the property so that rates can be reduced.
“We are here to help where we can. It is a fine balance of providing assistance and also to do so in a sustainable manner that allows the municipality to continue providing essential basic services, which are primarily funded from rates and services income,” said the City’s Mayoral Committee Member for Finance and Executive Deputy Mayor, Ian Neilson.