Community members challenge traditional councils over ‘taxes’

The law allowing traditional councils to compel communities to pay levies and taxes, which includes buying a new car for a chief, is unconstitutional, members argue in the Limpopo High Court.

The matter began last week, with the government and traditional authorities opposing it. The community members, represented by the Legal Resources Centre, say they are forced to pay a “wide range of levies” to the councils. These, they claim, are decided by traditional authorities, with no engagement with the affected communities. 

One community member in an affidavit mentioned how a chief would not allow the burial of an uncle until all outstanding levies were paid. Traditional authorities also refuse to provide letters, such as proof of address, which are mandatory for banks. One member had not paid a “levy” for a chief’s new car and was denied a letter needed to open a bank account.        

In their heads of argument, the members’ lawyers noted: “Limpopo is one of the poorest provinces”, with many relying on grants to get by. Community members “struggle to raise funds to pay these levies”.

The community members argue that the legislation allowing this — the Limpopo Traditional Leadership and Institutions Act (Limpopo Act) — is unconstitutional. It authorises traditional councils, by agreement with the premier, to impose “rates” on “taxpayers”. Further, it authorises leaders to “deal with” these  “taxpayers”. The constitution, however, makes no allowance for imposing taxes beyond elected bodies in government — no power is afforded to traditional leaders.

The community members note court judgments, including by the Constitutional Court, which confirm that citizens themselves, through elected officials, decide on taxes. Allowing unelected bodies such as traditional councils to impose taxes violates the basic principles of “no taxation without representation”. The constitution “carefully regulates” who can impose taxes — legislative bodies, the members say.

While the law expressly recognises customary law and traditional leadership, the community members point out that this can never violate the constitution. All the parties agree that customary law allows for asking for voluntary contributions but does not permit imposing taxes. This restriction cannot then be avoided “under legislation”.

The government, in response, argues that the powers in the Limpopo Act are part of the traditional leader’s “executive and administrative” powers. The government also says the levy “should not be understood through taxation law” as this “levy” fits into a specific context of traditional leadership administration.

But, the community members argue, even if it were “executive”, the constitution is clear that only legislative bodies can impose taxes.

The government also argues that, because no levies the community members complained of have been gazetted, as the Limpopo Act requires, the challenge is “premature”. But the members pointed out that they do not have to wait for proper enactment of a law to argue for unconstitutionality.

Even ignoring the legislation, the community members also sought an order from the court which would declare that customary law does not allow traditional leadership to impose taxes — only voluntary levies.

Historically, there was a system of voluntary tribute paid to traditional leaders. If the people were unhappy with their leader, the voluntary nature meant they could provide goods or services to another chief, one of the community members’ experts noted.  

The traditional authorities disputed various aspects of the members’ case. The authorities say the levies are voluntary, the communities were engaged and agreed to the taxes.

The community members argued that if the levies were “voluntary”, they never would have brought litigation and could have simply opted out of paying. The members also attached sworn testimony and documents containing receipts with phrases such as “Receiver of Revenue” on them.

The members noted that the traditional authorities did not attach any affidavits from other community members saying differently, nor minutes of any meetings where agreements were made. The community members’ lawyers also noted, in heads of argument that “the levies make up all or the majority of [the traditional authorities’] income and are central to their budgeting and planning”. This does not square with the assertion that the levies are voluntary, the members argue.

The community members challenged the status of seven traditional councils, as these were not registered before legislated deadlines in 2011 and 2023.  

The premier argued in papers that the matter should be dismissed entirely because of the community members’ failure to join “other traditional councils” in Limpopo. As the premier’s lawyers noted, if litigation could affect someone directly, that person must be part of the litigation proceedings. If such a person is not, the matter can be removed without even getting into the merits of the case. The community members, however, argue that by citing relevant government entities and relevant authorities — who represent individual councils — there is proper compliance.

The merits of the matter will be argued at the end of June in the Limpopo High Court.

moosat@businesslive.co.za