The Kenya Human Rights Commission (KHRC) and allied lobby groups filed a petition at the High Court to halt the contentious housing levy deductions, arguing they overburden payslips, deepen poverty, and serve as a tool for political patronage.
The groups, including Transparency International Kenya and the Institute for Social Accountability, claim the 1.5% levy on employees’ gross salaries, matched by employers, has failed to deliver affordable housing while being exploited to reward President William Ruto’s loyalists with housing units.
The Affordable Housing Act, enacted on March 19, 2024, mandates deductions to fund the Kenya Kwanza government’s housing agenda. However, KHRC contends the levy exacerbates economic hardship, with over a third of Kenyans living below the poverty line.
The petitioners argue that the deductions strip workers of disposable income needed for essentials like food and healthcare, pushing many into financial distress. “The levy is a regressive tax disguised as a housing solution,” said KHRC’s executive director, Davinder Lamba, at a Nairobi press conference.
The petition highlights allegations of political favouritism, citing Ruto’s promise to allocate 20% of 170,000 housing units, approximately 34,000 homes, to teachers and Harambee Stars players following a State House meeting. Lobby groups argue this politicises public resources, undermining equitable access.
“The housing fund is being used to woo voters, not solve homelessness,” stated Siasa Place’s director, Nerima Wako. The groups seek to declare Sections 3, 4, 5, and 12 of the Act unconstitutional, arguing they violate principles of fairness and transparency.
Previous legal battles set the stage. In November 2023, the High Court ruled the levy unconstitutional for targeting only salaried workers, excluding the informal sector, which employs over 20 million Kenyans.
A new 2024 law attempted to address this but failed to ensure equitable contributions, prompting fresh challenges. The petitioners also demand refunds for deductions made since July 2023, echoing earlier calls by the Katiba Institute.
Public sentiment on social media reflects frustration, with contributors decrying the levy as a poverty driver. The case, naming the Treasury, Lands Ministry, and KRA as respondents, awaits a hearing as Kenyans watch closely, hoping for relief from the financial strain.