Finance Act Suspension Lifted by Court
The orders prohibiting the implementation of the Finance Act 2023 have been lifted by the Court of Appeal pending the hearing and determination of the appeal.
Justice Mohammed Warsame ruled on Friday, July 28 that the appeal lodged by the Treasury Cabinet Secretary has merit.
“As a result of our decision, the application has merit and is granted as requested, with the effect that the order issued on July 10, 2023, suspending the Finance Act 2023 and the order prohibiting its implementation are lifted pending the hearing and determination of the appeal. The costs shall be determined by the outcome of the appeal,” stated a portion of the ruling.
The State argued that it was unclear what would happen to the Legislature, Executive, and Judiciary while the Finance Act 2023 was suspended.
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The respondents, including Treasury Cabinet Secretary Njuguna Ndugu and the Attorney General’s office, argued that the orders would create a revenue mobilization and expenditure approval crisis for the government.
The State argued before the appellate court that the country would suffer irreparable harm if the conservatory orders were not suspended. They provided an example of payroll taxes that can be imposed on employees.
The respondents, led by Busia Senator Okiya Omtatah, argued that tax reimbursement is impossible, citing the 16% fuel tax as an illustration.
Invoking his discretion, the judge stated that the court may suspend certain provisions whose implementation has irreversible effects and cannot be reversed, but not the entire Act.
The judge ruled, “Finally, had the trial judge considered the substantial and irreversible public interest in this case, the court would have hesitated to suspend the entire Act.”
“In conclusion, we are persuaded that the applicants have satisfied the twin principles for the granting of the requested orders and that the public interest favors vacating the conservatory orders issued by the trial judge.”
Justice Warsame nullified High Court Judge Mugure Thande’s ruling that extended the suspension of the Finance Act. Justice Thande argued that Kenyans would be unjustly taxed while rendering the decision.
A three-judge panel consisting of David Majanja, Lawrence Mogambi, and Christine Meoli will now decide the case.
Finance Act Suspension Lifted by Court
