The Kenya Revenue Authority (KRA) has recorded a significant milestone after surpassing the revenue target for the Housing Levy Fund, collecting Ksh73.2 billion in the 2024/2025 fiscal year.
The figure represents an overperformance of Ksh10 billion against the projected target of Ksh63.2 billion, translating to 115 per cent achievement. KRA attributed the success to improved compliance among salaried Kenyans, despite widespread concerns and political resistance surrounding the statutory deductions.
Introduced in March 2024, the levy requires employers to deduct 1.5 per cent of employees’ gross monthly salaries and remit the funds to KRA by the ninth working day of the following month. While the deductions have faced legal battles and public uproar, the government has remained firm, branding the levy a cornerstone of its affordable housing agenda.
However, the report reveals that nearly half of the collected funds remain unspent, as the housing project is still being implemented in phases nationwide. To prevent stagnation, the government has opted to invest surplus funds in debt instruments such as Treasury bills and bonds to generate returns while awaiting deployment to housing projects.
The announcement comes just weeks after President William Ruto reiterated his commitment to ensuring transparent and purposeful use of the levy. Speaking during the groundbreaking of student hostels at Tom Mboya University in Homa Bay, Ruto defended the deductions as vital for national transformation.
“People have been asking me about the Housing Levy Fund. This is the transformation it will bring to us as a nation. Apart from building affordable houses, we are also constructing 400 new markets across Kenya, and now we are turning housing infrastructure into student accommodation,” the President stated.
