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KRA responds to Kenyans calling for refund of housing levy after court ruling

Kenyans took KRA to task, calling for refund of Affordable Housing Levy collected with workers' unions across the country also calling for full refund, including interest

President William Ruto takes charge of a grader during the groundbreaking ceremony for affordable housing project in Thika town on Wednesday, August 9, 2023

The Kenya Revenue Authority (KRA) has responded to Kenyans demanding for Affordable Housing Levy refunds after the Court of Appeal on January 26, ruled that the levy remains suspended.

The ruling by the three-judge bench consisting of, Justices Lydia Achode, John Mativo & Mwaniki Gachoka came a time when deductions had already been made by some employers on January salaries.

The three-judge bench struck down the government's application to continue the levy collection pending an appeal on an earlier ruling which declared the 1.5 percent deduction on salaries with employers matching the same unconstitutional.

Workers' unions countrywide added their voices to the conversation, demanding for full refund of all monies deducted from their salaries under the controversial housing levy together with interests after the Court of Appeal’s ruling.

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“Workers stand in solidarity against illogical, illegal, and unconstitutional government policies that are unbalanced to meet the needs of Kenyans. We demand all housing levy deductions to be refunded with interest immediately. We demand the courts to be respected by the employers just like the employees do,” read the joint statement by worker’s union.

The Federation of Kenya Employers (FKE) promptly issued an advisory to its members, advising them to refrain from deducting the housing levy from their employees until the Court of Appeal hears and determines the substantive appeal.

"In light of the court order, we advise our members, not to deduct the levy unless the Court of Appeal rules otherwise after the hearing of the substantive appeal or in the alternative, should the government challenge the said ruling in the Supreme Court," FKE said in a statement.

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Shortly after the ruling, Kenyans took to social media to pile pressure on KRA to refund Affordable Housing Levy deducted from their salaries.

"It’s time for payroll, some of us have already been paid and the housing levy has already been deducted, so what do we do now? Shouldn’t we stop deducting it from January’s payslip as it has been declared unconstitutional?" X user Namrata wrote on X, with KRA responding.

"Kindly await official communication on the same," KRA responded.

Ruto's reaction

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Reacting to the halt in collecting the Affordable Housing Levy Fund, President William Ruto vowed to soldier on, claiming that he has enough authority from Kenyans to continue with the project.

“I have enough authority from Kenyans to continue with the housing project,” Ruto stated during a political rally in Meru on January 26, 2024.

While dismissing the application, the Court of Appeal ruled that the controversial levy was introduced without a legal framework.

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