State to consider reducing housing levy deposit - MP Kuria

Molo MP Kimani Kuria has said the government might consider lowering the Affordable Housing Project (AHP) levy deposit from the current 10 per cent to accommodate more middle and lower-income earners.

Kuria, who is the House Departmental Committee on Finance and National Planning chairperson, said many Kenyans felt the monthly levy was very high.

This proposal comes in response to concerns raised during the ongoing public hearings on the Affordable Housing Bill 2023, with many expressing dissatisfaction with the high monthly levy.

The lawmaker assured the public that the committee is actively collecting and considering the views expressed during the hearings.

He emphasized the committee's commitment to determining an appropriate percentage of the total housing unit cost that would better suit the financial capabilities of lower-income earners.

Addressing the residents in Kinangop, Nyandarua, Kuria stated, "The committee would incorporate their views in the Bill," highlighting the importance of inclusivity in the housing project. He acknowledged the high demand for AHP houses.

"It looks like there will be more people willing to take up the houses than the available units that the government is planning to build," he said.

To address concerns about potential over-subscription, Kuria outlined measures to ensure fairness. Those who pay but fail to acquire houses will receive prompt refunds, and in case of delays, the housing fund will compensate individuals with interest. The MP also emphasized the implementation of parameters to prioritize those affected by the project, preventing the wealthy from benefiting at the expense of middle and low-income earners.

Despite a lower court ruling the government's 1.5 per cent levy for affordable housing as unconstitutional, Kuria's remarks on the matter remain steadfast.

His comments come amid the Court of Appeal's decision on Friday, refusing to extend a stay that permitted the government to collect the controversial levy.

This levy, initially part of a finance law passed in June, aimed to fund affordable housing but faced legal challenges. The law also included a doubling of the value-added tax on fuel and an increase in the top income tax rate.