President William Ruto's administration has suffered a setback following the latest ruling on imposing of housing levy to facilitate his Affordable Housing Agenda.
In a ruling delivered by the three-judge bench of Justices Lydia Achode, John Mativo and Mwaniki Gachoka on Thursday, January 26, they upheld the High Court decision declaring the levy constitutional.
The Court of Appeals decision argued that the decision to impose the housing levy did not follow the stipulated framework.
The decision implies that President William Ruto's administration does not have a legal basis for making deductions as per the Finance Act 2023's amendment to the Employment Act 2007.
Read More
"The trial Court held that the Housing Levy was introduced without a legal framework. It also held that the levy was targeting a section of Kenyans. In our view, public interest lies in awaiting the determination of the appeal," the judges explained.
"This is because if the stay sought is granted at this stage, should the appellate Court affirm the impugned decision, then some far-reaching decisions that will have been undertaken pursuant to the impugned laws may not be reversible," they further observed.
"Public interest in our view tilts favour of in not granting the stay or the suspension sought. Public interest tilts in favour awaiting the determination of the issues raised in the intended appeals."
Justices Lydia Achode, John Mativo and Mwaniki Gachoka observed that the applications filed by the state could not change the court's decision declaring the levy unconstitutional.
They however directed the appeals filed by the government to be expedited to seal the fate of the housing levy.
"In conclusion, we find and hold that none of the 4 consolidated applications satisfies both limps. Accordingly, Civil applications Nos. E577 of 2023, E581 of 2023, E585 of 2023 and E596 of 2023 are hereby dismissed. We make no orders as to Costs. However, we direct that the appeals be heard expeditiously so that the issues raised in the appeals can be resolved with finality," the three-judge bench insisted.
Last year November, the High Court declared unconstitutional a 1.5 percent levy intended to fund affordable housing but later stayed the ruling until Jan 10 to allow for the government to appeal.
National Treasury Cabinet Secretary Njuguna Ndung’u and Attorney General Justin Muturi were among the parties who filed an application challenging the High Court's decision to declare the housing levy unconstitutional.
They argued that the suspension of monthly deductions would lead to a massive budgetary crisis and confusion in the country.
The ruling comes after the National Assembly initiated the process of anchoring the housing levy in the law. The Kenya Kwanza kickstarted nationwide public participation to get views regarding Ruto's legacy project.
The exercise sparked a storm with some stakeholders accusing the parliament of defying court orders on the levy.
It also triggered an onslaught against the Judiciary led by President Ruto who accused some Judicial officers of colluding with some cartels to sabotage his agenda.
Sustained attacks led to a dialogue between the Executive and the Judiciary led by Chief Justice Martha Koome.
