Muturi
Attorney General Justin Muturi has cautioned the Kenya Revenue Authority (KRA) against collecting the housing levy from salaried Kenyans saying it lacks legal basis.
KRA Commissioner-General Humprey Wattanga had in a February 12,2024 letter sought guidance from the AG on the government’s position on the controversial levy.
Muturi in a response letter told the KRA boss that the Court of Appeal’s January 26 decision declining to stay High Court orders that declared the levy unconstitutional still stands.
“The upshot of this is that there is no legal basis on which the housing levy as provided in section 84 of the Finance Act can be implemented,” the AG said
“Therefore, our considered opinion is that as of the date of delivery of the ruling of the Court of Appeal i.e on January 26, 2024, there is no legal provision that enables the collection and administration of the housing levy,” he added.
On November 28, 2023, the High Court declared the Housing Levy illegal citing various reasons including that it was discriminatory as it secluded workers in the informal sector.
The court however stayed the execution of the orders until January 10, 2024, pending the filing of an application for conservatory orders to stay the decision and allow the government to continue collecting the levy.
The Court of Appeal on January 26, stopped the State from carrying on with the collections reaffirming the High Court ruling that the 1.5 per cent Housing Levy which is meant to finance the affordable housing programme is unconstitutional.
However, Parliament announced the intention to appeal the matter at the Supreme Court of Kenya.
The National Assembly has so far introduced a new Housing Levy Bill in Parliament and amended the impugned sections.
The bill sailed through the second and third reading and has been forwarded to the Senate for adoption or rejection.
Also Read: KRA Issues Warning To Employers Over Housing Levy Deductions
