Good news as Uhuru scraps mandatory affordable housing tax

Announcement made at Jamhuri Day

President Uhuru Kenyatta

President Uhuru Kenyatta on Thursday announced an end to the proposed mandatory housing levy that would have been deducted by KRA from all Kenyans in formal employment.

President Kenyatta directed the National Treasury and Ministry of Housing to initiate amendments to Finance Act, 2018 to make housing levy voluntary.

The housing levy has been a contentious policy proposal that was heavily opposed by workers' unions as well as by Kenyan employers.

The law required all formally employed Kenyans to pay a monthly levy amounting to 1.5 percent of their salary to KRA which would then go to a fund meant to facilitate construction of affordable housing.

Employers were further required to match the amount contributed by their employees.

However, implementation of the deductions, which were to start in April 2018, delayed after the High Court halted the levy until the a case filed by COTU was heard and determined.

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