Kenya housing fund levy gets suspended by court

21 December 2018

The Employment and Labour relations Court has suspended the implementation of the proposed Housing Development fund levy temporarily, pending the hearing and determination of a case filed by the COTU (Central Organisation of Trade Unions).

COTU contested implementation of the 1.5% mandatory levy on every worker’s gross salary, arguing that it is unconstitutional, and it amounts to double the taxation. According to the Secretary General Francis Atwoli, the levy has far reaching implications on the right to fair remuneration. “Furthermore, the proper regulations to guide the implementation of the proposed levy are not in place,” he added.

COTU further contends the fact that there was no public participation in the amendment of the Employment Act which was set to come into effect on January 1st, 2019.

The fund

The creation of the Kenya housing fund is meant to help the State realise its goal of delivering 500,000 affordable housing units in five years to stop the expansion of slums and informal dwellings in major towns in the country. Currently, Kenya requires more than 250,000 housing units every year to meet demand. This is against the annual average of 50,000 units delivered by the government and private developers per year.

Information from: constructionreviewonline.com

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