URBAN COUNCILS TO LOSE $16M REVENUE ZETDC challenges rentals
THE Zimbabwe Electricity Transmission and Distribution Company (ZETDC) has applied for a declaratory order (declaratur) at the Harare High Court seeking to bar the country’s 32 urban council from collecting rentals on the company’s infrastructure (way-leave tax) dotted in all the towns and cities.
If the order is granted, local authorities stand to collectively lose $16 million annually in potential revenue.
It is reported that most of the towns annually charge anything from $500 000 in way-leave tax at ZETDC substations and related equipment.
The parastatal is represented by Muza and Nyapadi Legal Practitioners and have since written to all the urban councils about their course of action.
According to the court application dated April 20, 2017, ZETDC said: “Take note that the applicant intends to apply to the High Court in Harare for an order in terms of the draft order annexed to this notice and that accompanying affidavit and documents will be used in support of the application.
“If you intend to oppose this application you will have to file the notice of opposition together with one or more opposing affidavits, with the Registrar of the High Court at Harare within 10 days . . .”
The parastatal argues that the levying of way-leaves by urban councils is a violation of the provisions of the Urban Councils Act and that doing so was unlawful without a supporting statutory instrument.
A source close to the matter said ZETDC action was based on a Supreme Court case, where they successfully challenged the payments of way-leaves and development levies to 60 rural district councils in 2014.
The judgment was delivered by justices, Luke Malaba, Tendai Uchena and Antonia Guvava on January 4, 2015.
“The levying of way — leaves charges is outside the provisions of section 76 of the Rural District Councils Act (chapter 29;13) and is therefore unlawful,” reads part of the judgment.
The secretary general for the Urban Councils Association of Zimbabwe (UCAZ), Mr Livison Mutekede said the move by ZETDC would affect the local authorities’ revenue inflows.
“We are opposing the application as UCAZ. There is no way we will fold our hands. They have to pay for the use of our land like any other institution or rate payers.
“We stand to lose a lot of revenue. These way-leave charges are used for generating other purposes of revenue,” he said.
Chairperson of the town clerks’ forum, Mr George Makunde said local authorities have agreed in principle to challenge the court application by ZETDC. He said councils had assembled a legal team to defend their case.
“Yes, ZETDC has taken us to court and all the 32 urban councils are cited as respondents. It is unfortunate that I cannot comment much on a matter, which is before the courts, but what I can only tell you, is that all our members have since filed their opposing affidavits,” he said.