All Teachers to be refunded Their Housing Levy Deductions
All Teachers to be refunded Their Housing Levy Deductions. The Kenyan government’s housing proposal proposed by the Kenya Kwanza government has been ruled illegal by the Supreme Court, meaning teachers and other staff may soon start receiving higher pay.
From July to November 2023, the housing fee (arrears) will also be deducted from their paychecks.
Justice David Majanja, hearing petitions challenging the 2023 Finance Act, said the fee violated Article 10, 2(a) of the Constitution.
A housing levy amendment to section 84 was introduced, but Majanja, in his ruling on behalf of the client, read that it “lacks a comprehensive legal framework contrary to Article 10 of the Constitution, that levies against persons in formal employment without justification are discriminatory and irrational,” the panel of three said judges.
The other two judges included Lawrence Mugambi and Christine Meoli.
While Justice Majanja ordered that no further fees should be levied, he ruled that sections 84, 72 to 78 of the Finance Act were also declared invalid.
“An order is issued prohibiting the respondents from collecting, otherwise charging, a fee known as the Affordable Housing Act,” he said.
The levy, a mainstay of the Finance Act, began to be deducted from formally employed Kenyans in July, with the Kenya Revenue Authority (KRA) appointed as the collection agent.
Employers pay their contribution of 1.5 percent, along with a similar rate for their employees.
The government said the unwelcome deduction would allow them to achieve their ambitious plan to build affordable homes for low-income Kenyans.
The Finance Bill 2023 was passed by Parliament on 22 June 2023 and later assented to by President William Ruto on 26 June.
The High Court later stayed the implementation of the law on June 30 after several petitions were filed.
On 29 July, the Court of Appeal lifted the suspension, leading to a hearing on the case on 13 September.
Busia Senator Okiya Omtatah and six others have gone to court in a bid to stop the implementation of the 2023 Finance Bill.