President Ruto’s Affordable Housing Levy

President William Ruto’s affordable housing initiative faces a setback as the Court of Appeal has refused to extend an order allowing the government to continue collecting the housing levy. A panel of three judges ruled that public interest does not support granting the government’s request to suspend the High Court’s judgment declaring the levy illegal. The High Court had previously ruled that the introduction of the Housing levy lacked a comprehensive legal framework, violating various articles of the Constitution. The court found the imposition of the levy on formal employment without including non-formal income earners to be unfair, discriminatory, and irrational.

In today’s ruling, the appellate court questioned the public interest in allowing a constitutionally illegal statute to remain in effect pending an appeal. The Court of Appeal had previously granted the government permission to collect the controversial housing levy until today’s ruling, maintaining the status quo until a decision is made on whether to lift the order or extend it further.

President Ruto, a day before the court hearing, expressed frustration, accusing the legal system of sabotaging his plans and vowing to proceed with the projects despite court orders. Attorney General Justin Muturi had requested the court to permit the levy’s collection, emphasizing that it had generated over 120,000 jobs in the six months since its implementation.

Earlier in the week, the Federation of Kenya Employers criticised President Ruto’s affordable housing program, warning that it could add to the financial burden on taxpayers. The FKE, in a memorandum presented to the National Assembly committee on Housing, raised concerns about the 1.5% deduction from employees’ salaries for the Affordable Housing Bill, 2023, stating that it could pose an additional strain on workers.