Gov’t fights to save Finance Bill 2023 at Supreme Court

The government on Tuesday put up a spirited legal fightback at the Supreme Court to rescue the Finance Act 2023, which it was forced to revert to following the rejection of the Finance Bill 2024.

The Court of Appeal invalidated the 2023 Bill on July 31, labelling it unconstitutional for failing to consider the views of the public on various sections.

Through their lawyers, the appellants, who are the Cabinet Secretary (CS) for Treasury and National Planning, the Attorney General (AG), the National Assembly, the Speaker of the National Assembly, and the Kenya Revenue Authority, argued that they had conducted enough public participation on the 2023 Act, contrary to the findings of the appellate court.

“We will not be able to collect enough taxes if the Court of Appeal’s decision stands,” Prof. Githu Muigai, who was representing the AG and Treasury CS argued.

During the session, the National Assembly team, led by lawyer Issa Mansour, argued that the House’s standing orders allow the National Assembly to introduce further changes to any bill at the committee stage or in the Committee of the Whole House without undertaking another round of public participation.

“Nowhere did the National Assembly dismiss any submission, even where the same propositions were made by different individuals or institutions. This applied to the memoranda presented physically and on email,” said Mansour.

The KRA and the National Treasury further cautioned the bench that the government stands to lose revenue to the tune of Ksh.214 billion if the national exchequer is forced to revert back to the Finance Act 2022.

The government has already announced a loss of Ksh.346 billion following the rejection of the Finance Bill 2024.

On the other hand, the 53 respondents, led by Busia Senator Okiya Omtatah, maintained that the law was fundamentally defective and in violation of the Constitution, as it was enacted without public participation and that even the views collected were not considered.

“The Act did not factor in the demands of Article 220 of the Constitution,” said Omtatah.

In the Court of Appeal verdict issued by Judges Kathurima M'Inoti, Agnes Murgor, and John Mativo, the judges found various sections introduced post-public participation stage to amend the Income Tax Act, Value Added Tax Act, Excise Duty Act, Retirement Benefits Act, and Export Processing Zones Act were unconstitutional as they were not subjected to fresh public participation.

The marathon hearing concludes tomorrow, as more respondents will make their case as to why the Finance Act 2023 must fall.