The proposed draft Municipal Property Rates Amendment Bill which implies the levying of commercial rates on so called second properties could have dire consequences for property development, tourism and employment.
The passing of this Bill in its current form would be suicide for the economic advancement of tourism and for property development in South Africa.
Jeffreys Bay will be severely affected as guest houses together with B & B’s contribute significantly to bringing tourists to the town.
In order to speed up employment government should be relaxing punitive rates on such establishments and should be offering incentives for people to start businesses from their homes says Dacre Haddon from the Democratic Party (DA).
Probably the most controversial aspect of the Bill is the levying of commercial rates on so called second properties.
The Deputy Minister, Yunis Carrim, has stated that these commercial rates will be directed at guesthouse and bed and breakfast establishments and not second properties.
However, of concern is that the Minister does not say if other properties could face the same fate — for example occasionally let holiday homes or chalets.
What about guest houses which are not occupied all year round, as is the case in Jeffreys Bay which still endures a seasonal holiday market?
Unemployment in South Africa is at an all time high. Every effort needs to be made to create conditions for employment opportunity, not negate them.
The entrepreneurial spirit which allows citizens to open guest houses or purchase property for rental investment must not be dampened by imposing this irresponsible legislation.
Income from tourism, of which guest houses play a significant part, must be sustained. Tourism is one potential growth area for sustained employment creation.
Levying commercial rates on second properties and guest house establishments will only drive up costs and cause many to close down or downscale causing potential further job losses across the country.