President Kenyatta Defends 1.5 Percent Low-Cost Housing Levy on Kenyan Workers

President Kenyatta has defended the proposed 1.5 percent levy deducted from the salaries of every Kenyan employee to go towards funding the affordable housing project.

President Kenyatta says Kenyans should view the levy as a way of saving rather than a tax even as he assured workers that the cash will be in safe hands.

“We are not forcing agenda on people, but we are in talks so that we can present the ideas for them to contemplate on," Kenyatta said during a roundtable interview.

"New programs suffer misgivings and clarity but let those who are not sure about the agenda speak out and tell us their fears, all we are encouraging a saving culture versus spending culture."

Uhuru notes that there has been a lot of misinformation about the contribution, stating that workers who will not get houses under the program will get their money back.

“I want to assure Kenyans that this is not about tax as it has been made to look, but saving and a contribution towards owning a house."

Last week, the government suffered a blow after the high court suspended implementation of the levy pending hearing and determination of a case filed by Central Organization of Trade Unions (Cotu).

The union argues that the levy is unconstitutional and amounts to double taxation. It also avers that the government didn't engage workers in making the decision on the contribution.

"The petitioner is aggrieved that its unconstitutional and legally invalid to subject Kenyans to double taxation by imposing the 1.5% housing development levy on basic salaries," Cotu says in court documents.

Under the low-cost housing program, President Kenyatta's administration hopes to build at least 500,000 houses by 2022.

The project is one of Kenyatta's Big Four Agenda alongside manufacturing, universal healthcare, and food security.