Win for President Ruto as Supreme Court reinstates Finance Act, 2023
The Supreme Court has suspended a Court of Appeal decision nullifying the Finance Act, 2023.
In a ruling that now allows the government to continue collecting taxes using the extended law, the apex court cited public interest, saying the suspension would help maintain stability in the ongoing budgeting and appropriation process.
“In view of the public interest in the matter, we direct that the consolidated appeal herein be set down for hearing within the shortest time possible after the delivery of this ruling,” Justices Martha Koome, Philomena Mwilu, Smokin Wanjala, Njoki Ndung’u, Isaac Lenaola, William Ouko and Mohammed Ibrahim said.
The Finance Act 2023 has been the subject of litigation, with petitioners challenging the law’s constitutionality, which they said came about without proper public participation.
In November 2023, the High Court declared some provisions of the Act unconstitutional.
This prompted the filing of six appeals and three cross-appeals at the Court of Appeal, and in a judgment rendered on July 31, 2024, the appellate court declared the entire law unconstitutional.
Aggrieved by the court’s decision, the government— led by Treasury Cabinet Secretary, the Attorney General, the National Assembly and the Kenya Revenue Authority— lodged appeals at the Supreme Court of Kenya.
In a notice of motion filed before the apex court, the State sought a stay of execution of the Court of Appeal decision pending the hearing and determination of the appeal.
The appellants told the court that the contested decision of the Court of Appeal results in a problematic scenario where the government must rely on the Finance Act, 2022 for revenue collection in the upcoming fiscal year, as Finance Bill, 2024 was withdrawn.
Additionally, the appellants said the nullification of Finance Act, 2023 would result in a revenue shortfall of Sh240 billion, which would not be recovered unless the stay orders were issued urgently.
This, they argued, posed a real and immense challenge to the monetary and fiscal policy of the country.
Moreover, the State argued that decision to nullify the Act could trigger a constitutional crisis by impeding the government’s ability to lawfully collect and distribute funds.
They believed this disruption could lead to interruptions or halts in essential public services, potentially culminating in a complete government shutdown.
The applicants suggested that the government might be compelled to borrow money to address the fiscal deficit, which could substantially raise public debt and inflation.
They also claimed that the decision would leave the government vulnerable to numerous legal challenges, including lawsuits from stakeholders impacted by the disruptions in financial operations.
On its part, KRA told the supreme judges that eTims, the system for tax collection, had already been procured and installed and annulling the law would force the government to reinstate the old system, which would be costly and inconveniencing.
In pleading their case, the respondents argued that granting the requested orders would not serve the public interest.
They contended that if the consolidated appeal failed, Kenyans could face unconstitutional taxes for an extended period.
Furthermore, they emphasize that there is no chance for individuals to reclaim taxes paid under the Finance Act, 2023.
Additionally, the over 50 respondents told the court that Article 208 of the Constitution established the Contingency Fund for emergencies or unforeseen eventualities and therefore the government is not handicapped in meeting its fiscal obligations.
While making its decision, the Supreme Court said, “On our part therefore, taking into account the uncertainty regarding the revenue-raising measures and difficulty that may arise in the operations of the two levels of governments as posited by the applicants, coupled with the far-reaching implications of the declaration of the entire Finance Act, 2023 as unconstitutional, we are persuaded that the consolidated appeal may be rendered nugatory. Besides, prima facie, we are not convinced that the consequences of such a declaration would be reversible should the consolidated appeal be successful.”
Taxes
The decision means Kenyans will continue paying all taxes contained in the contested law, including 16 percent value-added tax on fuel.
The consolidated appeal is set the be mentioned before the deputy registrar of the court for purposes of ensuring compliance with earlier directions on filings.
The case will he heard virtually on September 10 and 11, 2024 from 9am each day.
cgichuki@ke.nationmedia.com
Shows
See AllAM Live
AM Live is NTV's morning current affairs show that sets the agenda for the day with insightful panels every weekday.
Business Redefined
Business Redefined is Kenya’s premier thought leadership platform for unpacking matters regarding economic and finance policy as well demystifying complex developments in the region’s capital markets.
Comedies
A collection of our premium content. Diam curabitur vehicula A collection of our premium content. Diam curabitur vehicula
Documentaries
A collection of our premium content. Diam curabitur vehicula A collection of our premium content. Diam curabitur vehicula
Entertainment
A collection of our premium content. Diam curabitur vehicula A collection of our premium content. Diam curabitur vehicula
Full Episodes
A collection of our premium content. Diam curabitur vehicula A collection of our premium content. Diam curabitur vehicula
Gumzo La Sato
Gumzo La Sato is a live social issues show that aims to create awareness about issues affecting the larger society. The discussions range from Parenting, Marital bliss and struggles, Oppression, violence, and all matters of the Heart.
Health Diary
Health Diary is a weekly show that highlights different types of diseases/conditions and seeks ways to prevent, treat/manage them. The show debunks this through real life stories and also feature specialists in different fields, to offer medical advice on the same.
Letter To My Younger Self
Letter To My Younger Self is a podcast where guests get to write a letter to their younger self, from which Maxine formulates questions to ask them during the hour-long show.
Nation Reports
Nation Reports is a weekly podcast offers an opportunity for listeners to interact with various reporters and journey with them as they unravel the biggest most emotive stories.
One Health Lens Podcast
Discussing health matters and human stories from Kenya and across Africa. We talk big picture from people to policy, ecosystems, and everything in between. Follow us on LinkedIn: https://www.linkedin.com/company/onehealthlens
Paradise Lost
Paradise Lost peeks through the story of Louis Otieno, the times, and everything in between.
Primetime
A collection of our premium content. Diam curabitur vehicula A collection of our premium content. Diam curabitur vehicula
Speaking of GEN Z
Speaking of Gen Z brings you entertaining but meaningful conversations about a generation that is trying to navigate through adulthood. Join hosts Michelle, Jackie and Esther as they unravel all things Gen Z.
Sport On
Sport-On is a 30-minute sports magazine show on NTV and 3 hours on NATION FM. The show seeks to give the sports “fanatics” and “funatics” comprehensive and in-depth coverage of sports both locally and internationally.
Tech-over
The extent of technological growth is beyond mere acknowledgment; it has seamlessly integrated into our daily existence. A few years ago, the notion of paying electricity bills through mobile money or recharging with 'tokens' in Kenya seemed inconceivable. Online product sales were considered distant, and artificial intelligence is rapidly reshaping various facets of our lives. Amidst these technological leaps, those with a solid understanding of tech can navigate challenges, seize opportunities, and build a sustainable livelihood. Tech over Show aims to be the platform facilitating discussions among thought leaders, innovators, tech companies, and the government, addressing challenges and opportunities in Kenya's thriving tech industry.
Thamani
Thamani is a business show which is dedicated to emerging issues regarding micro, small and medium size businesses.
The Politalk podcast
This is The Politalk podcast. Here we look into the ins and outs of everything Kenyan politics. We pull no punches and have no reason to sugarcoat anything that matters to Kenyans.
The Trend
A two-hour-long live show that airs on Fridays. The show focuses on what is current in the entertainment industry, controversial and popular across all media platforms targeting those aged between 25 and 35 years.
The trend podcast
The trend podcast highlights and captures the best of banter from #TTTT segment that airs every Friday on NTV. It's the TTTT EXTRA
The Wicked Edition
The Wicked Edition with Dr. King’ori seeks to address serious issues through humour and relatable wit. It is a two-part half hour show filmed in front of a live audience
Trending
A collection of our premium content. Diam curabitur vehicula A collection of our premium content. Diam curabitur vehicula
Twende
Twende is a travel show that highlights beautiful, unique, diverse locations, people, and cultures. The show offers fresh perspectives on familiar locations and memorable experiences in new ones.
Unscripted
This Saturday evening lifestyle show lets viewers share their stories and life experiences as openly & honestly for the purpose of shifting the culture of silence.
VIP Access
VIP ACCESS is Anyiko Owoko’s YouTube and podcast show on Music and Culture dedicated to promoting Africa’s most promising talent and creatives. This podcast grants you VIP access into timeless interviews while providing a platform for rising as well as established artists across the continent. Since launching in 2018, Anyiko has interviewed over 70 African music stars.
WADR
This weekly news show aims to have all sides of debate but not be constrained by it, listen to main voices in the contest but not allow them to hold the viewers hostage, entertain debate but allow push back with all due respect.
When death do us part
In this podcast, three widowers openly speak about the process of grief, how they found themselves exposed to the emotional turmoil of losing their wives, and how society still does not know how to deal with them.
Your World
Your World is a health, wellness and variety show. It provides a platform for audiences and experts to share their experiences on how to improve or manage health issues, across Kenya and the Africa region.