Attorney General Justin Muturi says housing levy deductions are illegal and warned the Kenya Revenue Authority against deducting the contentious housing fee.
In a letter to KRA Commissioner General Humphrey Wattanga, the AG referred to an order issued by the court of appeals on January 26, 2024, which affirmed a high court decision declaring the Housing Levy unlawful.
A three-judge bench supported petitions submitted before the high court contesting Section 84 of the Finance Act 2023, claiming that the fee was discriminatory and a blatant breach of Article 10 of Kenya's constitution.
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AG Muturi tasked Parliament earlier this month with making essential revisions to the contentious Housing Bill that would benefit ordinary persons.
After appearing before the joint committees of Finance and Planning and Housing and Urban Planning, the AG stated that the law also affects counties, contradicting majority leader Kimani Ichungwa's position.
He told the committee that all of the flaws mentioned by the courts in knocking down the Housing Levy had been addressed in the proposed measure but challenged them to improve the bill even further because they had the authority to do so.
“We are of the view that this bill addresses all the three issues raised by the courts, but like I said these are just proposals and the House has the powers to make further amendments to make the bill even better,” he said.
Last Wednesday, MPs passed 49 amendments to the Affordable Housing Bill, 2023, paving the way for all Kenyans, salaried and non-salaried, to contribute 1.5% of their salary to the Affordable Housing fund.
