The 1.5% Housing Levy Has Been Backdated, Prepare To Scream

That Preacherman said Mnachopigana nacho hamkijui! Kitawaramba! and is just what is about to happen to millions of Kenyans, courtesy of the Finance Act 2023 that seems to be taking full force after the ruling of the Court of Appeal.

The Court of Appeal suspended the orders that had been issued to suspend the implementation of the controversial Finance Act 2023, giving the Kenya Revenue Authority (KRA) and other state agencies to ensure that Kenyans scream properly.

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“The upshot of our decision is that the application has merit and the same is allowed as prayed with the effect that the order made on July 10, 2023, suspending the Finance Act 2023, and the order prohibiting the implementation of the Finance Act 2023, be and is hereby lifted pending the hearing and determination of the appeal,” the judges ruled.

As if to start with a bang, the Housing Levy has been backdated to July 1. The Act placed the Housing Levy at 1.5 percent, to be paid by employees. With the backdate, it means workers, in their August salary, 3 percent will be deducted as a Housing Levy instead of 1.5 percent.

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KRA had indicated that it would backdate most of the taxes that were missed during the period that the Act was in suspension, a move that is likely to see many Kenyans have little to show off on their payslips. The shocker starts with the Housing Levy.

In July, teachers screamed when they received their payslips with 6 percent having been deducted to cater for the National Social Security Fund (NSSF). The Union leaders had to write to the Salaries and Remuneration Commission (SRC) to seek clarity on the matter.

The Ministry of Lands, Public Works, Housing and Urban Development has since appointed Kenya Revenue Authority to collect the Housing Levy Taxes on its behave. Employers have been asked to ensure that this levy is paid without fail.

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