Githunguru MP Gathoni Wamuchomba has alleged that the Affordable Housing Project is a land-grabbing scheme.
The MP claimed that the programme is a plan to take land from rightful owners and give it to other people.
Speaking on Thursday at Spice FM, Wamuchomba claimed that the programme is a scandal in waiting.
"Housing Levy is the most contentious issue and the legal framework that has been managing the issue of housing to me is still not very clear," she said.
"When I said this is scandalous I meant that there are schemes of taking over prime land and handing over that land to other players unconstitutionally, unprocedurally, and irregularly and some of us will pay for what we are doing in future."
The legislator has been at the forefront of criticising the Finance Act 2023 which saw several tax laws implemented.
However, while speaking during the groundbreaking of the 2,000-unit-Mzizima Affordable Housing Phase I and 1,400-unit-Buxton Point Affordable Housing Phase 2 in Mvita, Mombasa County, President William said the project is aimed at allowing ordinary citizens to become homeowners.
Recently after the court ruled that the new housing levy of 1.5 per cent of gross salary is unconstitutional President Ruto noted that the affordable housing programme is critical for the creation of employment opportunities for the youth whose targeted employment capacity is expected to hit 500,000 jobs by 2027.
He said so far, the housing project has already created 120,000 jobs for the youth who form a critical clog in the country's economic matrix.
"If we don't engage these people (youth) in productive work, they will become a very big challenge to all of us," Ruto said.
The President observed that low-income earners will pay an interest rate of as low as 3 per cent a year as compared to the market rate of 18 per cent annually.
The Ministry of Housing and Urban Development, however, said all employers must continue deducting the Affordable Housing Levy from their employees.
Lands CS Alice Wahome said the levy remitted should include the employers' contribution.
This is 1.5 per cent of the employee's earnings to the fund with employers required to match an equal amount.
The Ministry warned that employers who fail to deduct the levies will be penalised as per the law.
"Please note that the employer’s contribution to the Affordable Housing levy is an allowable deduction under Section 15 of the Income Tax Act," Wahome said.
"An employer who fails to comply with the law shall be liable to payment of a penalty equivalent to two per cent of the unpaid funds for every month if the same remains unpaid."