Kenya’s High Court has ruled unconstitutional key clauses of the Finance Act 2023, including a mandatory housing levy, as the country grapples with rising public debt and economic hardships.
Controversial Finance Law Struck Down
Kenya’s High Court has struck out important clauses of the Finance Act 2023, citing unconstitutionality. This includes the mandatory housing levy, which was deemed discriminatory and arbitrary.
Implications on President Ruto’s Affordable Housing Agenda
The housing levy is a crucial component of President William Ruto’s plan to build 1 million homes by 2027. The court’s decision poses a significant setback to the government’s affordable housing program.
Public Backlash and Economic Fallout
The finance law, which led to increased taxes on petroleum products and personal income, sparked widespread protests and public discontent. The economy has suffered, with reports of job losses and a challenging business environment.
Debt and IMF Support
The government’s focus on revenue collection through the finance law is driven by the need to address a mounting foreign debt, currently at $70 billion. Despite opposition, the International Monetary Fund has supported the law as part of the debt repayment strategy.