President William Ruto has announced plans to exclude all first-time home purchasers from paying stamp duty in an effort to reduce housing prices for employees struggling with growing living costs and mainly stagnant salaries.
Speaking during the launch of Soweto East Zone B Social Housing Programme in Kibera Constituency on Tuesday, the head of state responded to a trader in the audience by saying that stamp duty would be eliminated. He added that his government would work to achieve revenue balance by doing away with the stamp duty for first-time homebuyers and by encouraging compliance with other property-related taxes like land rates and rent.
Following modifications to the law established by the previous administration, the exemption from stamp duty now extends to first-time homebuyers of certified affordable housing units.
”As a government, we have stated that if you are purchasing a home for the first time, we cannot tax you.” We will abolish stamp duty. But, even if we eliminate stamp duty for first-time homeowners, you must pay land rates because otherwise, how would we afford water supply, road development, power connection, and rubbish collection?” He asked.
Stamp duty is levied on the market value of the property at a rate of 4% in cities and 2% in rural regions, and it must be paid to the taxman within 30 days after contract signing to avoid penalties.
President Ruto added that affordable housing is a priority for the government “because it would enable even Mama Mboga and boda boda to purchase a house in Nairobi.”