National Assembly Goes To Supreme Court Over Housing Levy

This comes after President William Ruto declared that his government would appeal the Appellate Court's decision.

National Assembly Goes To Supreme Court Over Housing Levy
The National Assembly in session on June 14, 2023. /PARLIAMENT OF KENYA

The Speaker of the National Assembly on Wednesday, January 31 announced the intention to appeal the recent ruling by the Court of Appeal which upheld the High Court ruling temporarily halting the collection of the Housing Levy at the Supreme Court of Kenya.

A notice by the Speaker, Moses Wetangula, also acting on behalf of the National Assembly revealed his intention to appeal against the entirety of the said ruling.

"Take notice that the National Assembly and the Speaker of the National Assembly, the 1st and 2nd applicants in Nairobi Court of Appeal Civil Application No. E577 of 2023 (the "Appellants"), being dissatisfied with the decision of the Court of Appeal (Hon. L. Achode, Hon. J. Mativo & Hon. M. Gachoka (CIA), JJ.A) delivered at Nairobi 26th January 2024, intend to appeal to the Supreme Court of Kenya against the whole of the said Ruling,” read part of the appeal notice.

President William Ruto interacting with a construction worker at the Kibra Affordable Housing project on November 22, 2023. /PCS

This comes after President William Ruto declared that his government would appeal the Appellate Court's decision.

"We are going to appeal the decision. We will make the requisite law so that our agenda to create employment for jobless youths who have finished school but have nowhere to go is realized through the housing projects," the President said while speaking in Meru County.

"It is the first time in the Republic of Kenya that we have an administration that has a clear and demonstrable plan to create jobs for millions of young Kenyans."

Furthermore, his government announced its intention to file an appeal against the High Court’s decision to declare the deployment of Kenyan police officers to Haiti illegal.

Following the Appellate Court's ruling, the Housing Levy remained suspended as declared by the High Court, whose ruling was upheld by the three-judge bench of Justices Lydia Achode, John Mativo and Mwaniki Gachoka on Friday, January 26.

The appellate Judges stated that if they affirmed the constitutional invalidity of the challenged laws, then some far-reaching decisions that would have been undertaken may not be reversed.

"The trial Court held that the Housing Levy was introduced without a legal framework. It also held that the levy was targeting a section of Kenyans. In our view, public interest lies in awaiting the determination of the appeal.

"This is because if the stay sought is granted at this stage, should the appellate Court affirm the impugned decision, then some far-reaching decisions that will have been undertaken pursuant to the impugned laws may not be reversible. Public interest in our view tilts favour of in not granting the stay or the suspension sought. Public interest tilts in favour awaiting the determination of the issues raised in the intended appeals," the ruling sent to newsrooms read in part.

The judges had also argued that it would be unfair to deduct the money as it could not predict how its final verdict. If found unconstitutional, the process of refunding the amount of money would complicate the case. 

Earlier in January, the Appellate Court allowed the government to continue deducting 1.5 per cent from Kenyans' salaries in the form of the Housing Levy until its verdict on January 26.

Before it was declared unconstitutional by the High Court, the controversial housing development levy contained in the Finance Act, 2023 was fiercely opposed to the point that the government struggled severally to explain why it was deducting 1.5 per cent from all salaried Kenyans in support of President Ruto's Affordable Housing Programme.

Employees began being charged a 1.5 per cent tax on their gross salary starting July 2023, with employers expected to match the 1.5 per cent housing deduction with proceeds going towards the National Housing Development Fund (NHDF).

An illustration of the Affordable Housing Programme by Boma Yangu Initiative under the National Housing Corporation. /BOMA YANGU KENYA