A three-judge bench has on Tuesday nullified the collection of the Housing Levy fund. The Housing Levy suspension was due to sections of the Finance Act being unconstitutional.
Chief Justice Martha Koome had, on July 18, selected the Judges to hear and determine petitions challenging the Finance Act, 2023.
The rulling was made after the hearing by Justices David Majanja, Christine Meoli and Lawrence Mugambi. The judgement directed the government to cease collection of Housing Levy as it contravened the Constitution.
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“The levy against persons in formal employment to the exclusion of other non-formal income earners without justification is discriminatory, irrational, arbitrary and against the constitution,” Justice David Majanja ruled.
In Justice Mugambi rulling, he said that the budget estimates were legally presented. Thus the Finance Bill was a money bill within Article 114 of the Constitution and was legally presented.
“In view of the foregoing, we are satisfied that, applying the peel and substance test, the Finance Bill 2023 is a money bill; however, it contains matters that are extraneous to a money bill and are unconstitutional.”
However, the government bowed down to the rulling but the government lawyers asked the High Court for an order to prevent Kenyans from asking for housing levy refunds. This will prevent those that have contributed from getting refunds of the same.
Busia Senator Okiya Omtatah, the Law Society of Kenya and others had moved to court challenging the Finance Act, saying that it was unconstitutional. After the rulling, Okiya Omtata said that its a win for the people of Kenya.
“The High Court Bench has declared the Housing Levy unconstitutional for violating key provisions including Singling out Formal Sector.”
Th Housing levy suspension becomes another rulling against the exucutive in recent days after several other rulling against several Implementations have been overturned.