The High Court on Monday, July 10, ruled that the Finance Act 2023 will proceed to a full trial and extended its suspension.
Judge Mugure Thande ruled that if implemented, some Kenyans will be unfairly subjected to taxes.
The case was filed by Busia Senator Okiya Omtatah challenging the constitutionality of the Act which has since been assented into Law by President William Ruto.
"The petitioners have proved that they have a prima facie case....there's merit in granting conservatory orders," the judge ruled.
“Upon evaluation of the submissions, I have no difficulty finding that the petitioners have established a case with a probability of success.”
During the ruling, Judge Thande noted that public interest lay in the momentary suspension of the Finance Act and that the State would not be prejudiced.
The judge has certified the matter for an expanded bench giving way to Chief Justice Martha Koome to appoint judges to hear and determine the case.
The respondents in the petition had sought abeyance (temporary suspension) of seven days to move to the Court of Appeal.
The respondents including Treasury Cabinet Secretary Njuguna Ndugu and the Attorney General's office noted that it was unclear what would happen to the Legislature, Executive and Judiciary during the time when the Finance Act 2023, remained suspended.
It was argued that the orders issued to suspend implementation of the Finance Act 2023, would bring crisis to the government in relation to revenue mobilisation and expenditure approval.
As such, the respondents had prayed to the High Court to exercise its secondary jurisdiction and suspend the conservatory orders. But the defence argued the orders cannot halt government operations.
“It is already 12 days since you suspended Finance Act 2023 and the government has not shut down. Our colleagues should stop scaremongering. The law provides for mechanisms of continuity through the Finance Act 2022. All that has stopped are the new taxes,” defence lawyer Otiende Amollo argues.
Omtatah had argued that the Finance Act contained amendments to several laws that had nothing to do with raising revenue and laws that affected the work of the Senate in protecting the interests of counties and their governments.
The first-term senator had further argued it was against the law to force employees to contribute an amount of money based on the applicable blanket deductible percentage without consideration of their existing contractual obligations on their salaries arguing it was not reasonable.
