Ruto’s reaction to legal setback for housing levy

Taiwo Ajayi
3 Min Read

In a sharp reaction to a Court of Appeal ruling that halted the collection of a levy intended to fund his flagship housing project, Kenya’s President William Ruto expressed his displeasure and pledged to appeal the decision.

The appellate court had stopped the government from collecting the levy, which had been deemed unconstitutional by the High Court.

During a meet-the-people tour, President Ruto initially remained defiant, emphasizing the importance of public opinion and asserting his intention to continue with the housing project despite the court order. However, he later clarified that the government would appeal the ruling and work to regularize the law, as suggested by the High Court.

Ruto addressed the issue, stating, “For the avoidance of doubt, I want to tell them that we were in the process of creating a law to guide the process, and they should have given us time.

We will also appeal the case so that we continue with the program and create jobs for millions of Kenyan youths.”

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The Federation of Kenya Employers (FKE) issued a directive to its members, advising them not to deduct the levy unless the Court of Appeal rules otherwise in the main hearing or if the government successfully challenges the ruling in the Supreme Court.

President Ruto criticized the court for not allowing his administration sufficient time to create a law to implement the housing scheme. He argued that the project aimed to create jobs and fulfill the objectives outlined in the Kenya Kwanza manifesto.

The Court of Appeal’s decision rejected the government’s argument that the appeal would be rendered useless if the High Court’s decision to suspend the levy was upheld.

The judges emphasized that taxes could be backdated and collected even if the appeal was successful.

The housing levy, introduced through the Finance Act of 2023, required over 3.2 million Kenyans in formal employment to contribute 1.5 percent of their salary, matched by a similar percentage from employers.

The High Court had previously declared the levy illegal, citing its discriminatory nature against non-formal income earners.

READ ALSO: Kenya housing levy: Blow to William Ruto as court blocks tax

President Ruto’s announcement of the government’s intention to appeal sets the stage for further legal proceedings, and the outcome will have significant implications for the funding and implementation of the housing project.

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