High Court Upholds Housing Levy Under Affordable Housing Act, 2024

The High Court has upheld the legality of the housing levy introduced under the Affordable Housing Act, 2024, allowing the government to proceed with its affordable housing initiative. A three-judge bench—comprising Justices Olga Sewe, John Chigiti, and Josephine Mongare—ruled that the legislative process included sufficient public participation.

According to the judges, citizens were given ample opportunities to share their opinions before the housing levy became law. The verdict follows six petitions that challenged the levy, with petitioners arguing that the process lacked adequate public involvement and breached constitutional principles.

The 1.5% levy, applied to the salaries of all taxable Kenyan workers and matched by employers, was enacted in June of the previous year to support the government’s affordable housing agenda. However, the levy faced significant legal opposition, as it was introduced alongside broader tax hikes on essential goods. These increases compounded financial difficulties for Kenyans already struggling with high inflation.

The levy’s introduction sparked widespread dissatisfaction, fueling protests last year against President Ruto’s administration. Public outrage, especially among Gen-Z citizens, resurfaced this year when the Finance Act 2024 proposed additional tax increases.

Despite the opposition, President Ruto has defended the housing fund, asserting that it will provide affordable homes, generate jobs, and lower public debt levels.