Access to affordable housing is a basic human need and according to Article 43 of the Kenyan constitution, every person has the right to accessible and adequate housing. In addition, under the social pillar of the Kenya vision 2030 , development of equality and affordable houses for low income earners is a priority.
Further, through the bottom-up economic transformation agenda the government plans to close the housing gap by facilitating a delivery of 250, 000 houses per year.
President William Ruto, is on record as saying that the plan for creating new generation of home owners under the affordable housing programme is on course.
The president has on numerous functions stated that his administration has already commissioned 17,850 units in Mukuru ,Rongai, and Kibera to ease the housing burden affecting the low income earners. He said that the programme also targets over 6.5 million of Kenyans living in slums and informal settlements.
While in Machakos Ruto launched the Mavoko affordable housing project, a joint initiative between the government of Kenya and private sector developers supported by UN-Habitat.
" I am happy today that we are building about 53,000 housing units as part of Kenya Kwanza housing program. This is a project which unites the Kenyan government and the United Nations through UN - Habitat, private sector and now also we have received from the county government of Machokos," the President said in a previous launch
As a Kenyan, one may want to ask; How is this going to be achieved? Will the Kenyans be comfortable with it? How is the funding going to be done?
Kenya Revenue Authority (KRA), the body in charge of collecting revenue from tax payers, gave statistics on how Kenyans will be burdened to pay for the government's project in construction of the affordable houses.
This is also covered in the Finance Act of 2023 that; there is introduction of Housing Levy at 1.5 % of the Gross monthly salary much to buy the 1.5 % by the employer, introduction of PAYE at 32.5 % and 35% for monthly incomes greater than Kshs 500,000 and Kshs 800,000 respectively which was supposed to be paid from 1st July 2023.
Whereas the Finance Bill 2023 proposed a Housing Fund contribution of 3 % of the basic monthly salary capped at Kshs 5,0000, the Act established an uncapped levy of 1.5% of gross salary.
The concept of taxation of employees has raised issues in court. For instance, on 28th November 2023, the court entered judgment to the effect that introduction of the levy was unconstitutional and consequently issued prohibitory orders against the charging, deduction and collection of the levy.
A three - judge bench of the court argued, in a ruling delivered that the move back safeguards public interest should the outcome of the appeal sustain decision of the high Court. In the contested decision rendering President Ruto's housing plan illegal, Justices David Majanja, Christine Meoli, and Lawrence Mugambi said the key provision for Housing Levy under the Finance Act (2023) violated the constitution
The judges argued that by singling out the formal sector without justification, the law failed to confirm to the principal of non-discrimination.
The high court held that the introduction of housing levy was discriminatory to the extent that it imposed taxes solely targeting employed Kenyans excluding those in informal sector.
David Majanja while reading the decision of the bench said that levy amendment lacks comprehensive legal framework and contravened Article 10(2) (a) of the constitution.
" The levy against persons in informal employment to the exclusion of other non formal income earners without justification is discriminatory, arbitrary and against the constitution," Justice Majanja declared.
The court further directed the employers to cease levy from employees with immediate effect.
What benefit will the affordable housing program bring to the Kenyans? This is a critical question ought to be answered with keenness and wisdom. First, the government claims that with the construction of affordable Houses will create jobs to thousands of Kenyans, especially in the constitution industry.
In addition, the government says that programme will result to economic growth. This will be achieved through increasing investment in the real estate and construction sector.
Still, the Kenya Kwanza government argues that the plan will enable Kenyans easily access meaningful shelters at a low price.
I concur that this is a valuable plan that the government has to its citizens, but here lies the challenge; How will Kenyans be comfortable being taxed heavily in such hard economic times? Will they struggle to find basic needs for their families or work for the government's projects? What of those unemployment citizens, will they just benefit from the employed Kenyans?
The government should ask itself whether the affordable housing project should continue or else be sabotaged.
The Writer, Eric Mutuku is a Second Year Communication Studies student at Chuka University.
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