Affordable Housing Bill: Housing Levy Deductions Will Not Be Backdated

March 19, 2024

President William Ruto is today(Tuesday, March 19) expected to assent to the Affordable Housing Bill, paving the way for the return of housing levy deductions.

The signing was initially scheduled for Monday morning but a communique from State House indicated the president will sign the bill today. Once signed into law, the Affordable Housing Act of 2024 will prevent the backdating of housing levy deductions.

The court had halted the government from implementing housing levy deductions from salaried Kenyans due to its introduction without a legal framework.

However, despite opposition from opposition MPs, Parliament approved the Bill with amendments last week.

According to Kimani Kuria, the Chairperson of the National Assembly Finance and National Planning Committee, the President’s signature on the Bill will usher in a new legal framework, known as the Affordable Housing Act, 2024. This new law will replace Section 84 of the Employment Act and the Finance Act with new Sections 31B and 31C, which were the basis for the previous housing levy deductions.

“With the enactment of the Affordable Housing Bill into law, it gives rise to a new legal framework and, therefore, housing levy deductions will only come into effect on the enactment of the Bill,” said the Molo MP.

“There will be no backdating of the deductions as the previous deductions were made as per provisions of the Finance Act Section 84 of the Employment Act with the insertion of new section 31B and 31C. These sections have now been repealed in the Affordable Bill,” Mr Kimani added.

National Assembly Leader of Majority Kimani Ichung’wah confirmed the same, saying: “No deduction will be backdated. Commencement date is upon assent and, therefore, the deductions become effective immediately upon assent.”

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