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Kenya court declares 1.5% housing tax unconstitutional

There is a big need for affordable quality housing in Kenya. IMAGE CREDIT: GETTY IMAGES/BBC news
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A Kenyan court has declared as unconstitutional a 1.5% housing levy that was imposed by the government as part of a finance law in July.

A three-judge bench ruled that the tax lacked a comprehensive legal framework and was irrational.

The introduction of the housing levy, among other other taxes, fuelled protests amid a high cost of living.

The government has asked the court for a stay of the judgement for 45 days as it decides on the next course of action.

BACKGROUND

Authorities in Kenya introduced a new salary levy to help build low-cost homes. This meant employees would pay 1.5% of their pay to the housing fund and that amount would be matched by the employer.

The decision was met with angry responses in Kenya. The anger stemmed from suspicion that the extra money could be lost through corruption.

The total monthly payment per person was estimated at $50 (£38), but the government hoped that $500m would be raised every year.

The government aims to build 500,000 affordable homes by 2022

SOURCE: BBC NEWS

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