Lawyers under the Law Society of Kenya (LSK) have rushed to court to challenge the legality of the Housing Levy, which is contained in the controversial Finance Act, 2023.
In a certificate of urgency, LSK argues that the Housing Levy, which is mandatory for all employees and employers, threatens the social economic interest of all Kenyans.
The legal body has named the National Assembly, Kenya Revenue Authority (KRA) Commissioner General, and Attorney General Justin Muturi as respondents in suit.
LSK says the government has no justification to force Kenyans to contribute to a housing scheme when they are already grappling with tough economic times and a myriad of taxes.
“The petitioner has come to this Honorable Court under extreme urgency following the decision of the Respondents to gazette and enforce the unconstitutional, unlawful and unreasonable Finance Act 2023 that introduce mandatory affordable housing levy, implementation, which threatens the social economic interests of Kenyans against the principle of social justice,” the documents filed in court read.
The society led by President Eric Theuri also argues that the new levy will encumbrance Kenyan employers and employees who are already overburdened resulting in job losses.
LSK says the controversially passed Finance Act, whose halted operation was lifted by the Court of Appeal earlier this week, goes against the Constitutional principle of social justice.
In its suit, LSK wants the court to bar the government from implementing the Housing Levy and Section 10 (2) (3) of the Income Tax Act amended by Section 7 of the Finance Act 2023.
The implementation of the Finance Act 2023 had been suspended last month by the High Court in a suit filed by Busia Senator Okiya Omtatah but was lifted by the Appellate Court.
This comes as Kenya Revenue Authority (KRA), which has been mandated as the collecting authority, has backdated the collection of the housing levy to July1, 2023.
President William Ruto has incessantly defended the import of the Act arguing that it will enable the country to finance its projects and reduce overreliance on foreign borrowing.