Court Issues Final Ruling on Finance Act 2023

 President William Ruto
A photo of President William Ruto

The High Court on Tuesday declared some sections of the Finance Act, 2023 unconstitutional including the Housing Levy. 

A three-judge bench comprising Justices David Majanja, Christine Meoli, and Lawrence Mugambi ordered the government to cease collection of Housing Levy holding it contravenes the Constitution. 

"The levy against persons in formal employment to the exclusion of other non-formal income earners without justification is discriminatory, irrational, arbitrary, and against the constitution," Justice David Majanja ruled.  

Nairobi Law Courts
A photo of the statue outside the Nairobi Law Courts

Immediately after the ruling, State attorneys asked the High Court for an order to prevent Kenyans from demanding Housing Levy refunds.

While delivering the ruling, Justice Mugambi however observed that budget estimates were legally presented. He pointed out that the Finance Bill was a money bill in line with Article 114 of the Constitution. 

"In view of the foregoing, we are satisfied that, applying the peel and substance test, the Finance Bill 2023 is a money bill; however, it contains matters that are extraneous to a money bill and are unconstitutional," Justice Mugambi ruled. 

While the High Court was satisfied that the public participation process conducted by the National Assembly was sufficient, it faulted the Parliamentary Committee for failing to factor in proposals fronted by Kenyans.

The petitioners had further argued that the National Assembly erred by not involving the Senate in the formulation of the law.

The 3-judge bench ruled that the National Assembly Speaker Moses Wetang’ula did not have to seek concurrence from Senate speaker Amason Kingi on the Finance Act, 2023. 

Chief Justice Martha Koome had, on July 18,  selected the Judges to hear and determine petitions challenging the Finance Act, 2023.

This was after Busia Senator Okiya Omtatah, the Law Society of Kenya and others moved to court challenging the Finance Act, saying that it was unconstitutional.

"The High Court Bench has declared the Housing Levy unconstitutional for violating key provisions including singling out Formal Sector," Omtatah celebrated moments after the ruling. 

Okiya Omtatah
Lawyer and Busia Senator Okiya Omtatah on June 18, 2023.
Okiya Omtatah