Nyamira Senator Okong'o Mogeni is pushing to reintroduce a maximum deduction amount on the Housing Levy, following the National Assembly's decision to abandon a similar proposal.
In the Senate Order Paper dated Tuesday, March 12, Mogeni contends that no Kenyan should be required to pay more than Ksh2,500 towards the Affordable Housing Programme.
This forms one of two amendments proposed by the Azimio senator to the Affordable Housing Bill of 2023.
“The Levy shall be paid at the rate of 1.5 per cent of the net salary of an employer or the net salary of an employee provided that the amount paid to the collector shall not exceed Ksh2,500,” the proposed amendment states.
The National Assembly passed the Bill on February 21, where it was proposed a 1.5 per cent levy on workers' gross pay
This was despite initial attempts by the opposition to have the 1.5 per cent levy anchored on net pay.
Mogeni’s amendment will face an uphill task to pass in a Kenya Kwanza-dominated senate.
It should be noted that the cap was first proposed in the Finance Bill 2023.
Before the second reading of the Bill in the National Assembly, members of the Kenya Kwanza coalition successfully agitated for its removal.
This gave President William Ruto’s administration the greenlight to deduct 3 per cent from all salaried Kenyans.
Sections of the Finance Act including the Housing Levy were later deemed unconstitutional by the High Court.
The argument was that the Housing Levy limited the deductions to formal sector employees.
As such, the National Assembly Majority Leader Kimani Ichung’wah tabled the Affordable Housing Bill 2023 which has since been passed by the National Assembly and now awaits approval by the Senate.
