President William Ruto has suffered yet another setback after the Court of Appeal declined to lift orders by the high Court suspending his ambitious Housing levy.
In a ruling delivered by a three-judge bench, the Court held that the deductions remain suspended.
“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,” read part of the ruling.
Also Read: Court Extends Housing Levy Deductions Period
Arguments Made by the Court
According to the court, the big question was whether granting a stay would be in public interest as the effect would allow the levy, which had been found to be constitutionally infirm, to continue being in the law books.
“This is because should the Court hearing the appeal affirm the constitutional invalidity of the impugned laws, then all actions that will have been undertaken under the impugned sections of the law during the intervening period will be legally frail,” part of the ruling read in part.
According to the Court, 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. 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.
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“Public interest in our view tilts favor of in not granting the stay or the suspension sought. Public interest tilts in favor awaiting the determination of the issues raised in the intended appeals.”
Earlier Ruling Extending the Deduction Period
On January 4, the Court of Appeal extended the period of housing levy deductions to January 26, 2024.
The court ruled that the government should continue deducting the levy pending the determination of various applications before it.
The three-judge bench made the ruling after hearing the appeal filed by the National Assembly and the National Assembly Speaker Moses Wetangula.
“Upon hearing the parties, all the applications are consolidated as they arise from the same judgment of the High Court dated 28h November 2023. Civil Application No. E577/2023 is designated as the lead file. The ruling on these consolidated applications will be delivered on 26th January 2024,” read part of the ruling.
“In the meantime, the status quo obtaining as of today shall be maintained until the delivery of the ruling. Made at Nairobi this 3rd January 2024,” read the other part of the order.
High Court Ruling on Housing Levy
However, in November 2023, the High Court declared the deduction of the 1.5 percent levy, intended to fund affordable housing projects, unconstitutional.
However, following a prayer to the court by the Kenya Revenue Authority (KRA), through its Lawyer Ochieng Gaya, seeking 45 days stay from the court over the ruling, the Court issued staying orders on its judgement until January 10, 2024.
“That pronouncement places us in a very awkward situation because we not only collect the housing fund but there are also other agencies so we will be seeking that pronouncement to be stayed.
“One, KRA as clearly captured in the judgement had issued a system adjustment and a public notice and this system adjustment, we are all aware that the pay is being collected together with the housing fund. That system adjustment will require time for it to be readjusted,” stated Gaya.
