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Kenya’s affordable housing act levy continues after court ruling

Teresiah Ngio by Teresiah Ngio
July 12, 2024
in News
Reading Time: 2 mins read

The High Court of Kenya has ruled to continue the collection of the Affordable Housing Act levy, following a decision to decline the temporary suspension of certain sections of the Act. This decision was based on the public interest in maintaining the law until ongoing petitions are resolved.

A three-judge bench, comprising Justices Olga Sewe, John Chigiti, and Josephine Mong’are, emphasized the presumption of constitutionality for laws enacted by Parliament. They noted that unless there is clear evidence of rights violations, the court cannot halt their implementation.

Chief Justice Martha Koome consolidated six petitions challenging various aspects of the Affordable Housing Act of 2023. The petitioners, led by Dr. Magare Gikenyi, argued that the absence of a governing board to oversee the fund and the uncertainty surrounding the levy’s collection exposed the funds to potential theft and misuse. They cited Article 10(2) of the Constitution, which emphasizes national values, good governance, integrity, transparency, and accountability.

The petitioners also pointed out that the mandate of the Kenya Revenue Authority’s Commissioner General is limited to overseeing the authority’s affairs, not collecting the housing levy. Furthermore, they highlighted that the 1.5% housing levy lacked a detailed operational plan required by law before the collection of public funds.

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In defense, the government maintained the presumption of constitutionality for all Acts of Parliament. Parliament supported this by arguing that the Affordable Housing Act provides a legal framework for the levy. They emphasized that levies are common in Kenya, citing the Road Maintenance Levy and the Petroleum Levy as examples.

The judges concluded that the petitioners failed to demonstrate that the contested provisions posed significant risks to life or limb or sufficiently violated the Bill of Rights to warrant the requested injunctions. They expressed doubt that denying the injunctions would undermine the effectiveness of the petitions.

“It is our finding, therefore, that the petitioners have failed to show that the impugned provisions pose a danger to life or limb or that they threaten the Bill of Rights to warrant the orders sought. We are not persuaded that the petition will be rendered nugatory if the orders sought are not granted,” the judges stated.

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