HomeNewsPOLITICSSupreme Court Puts Finance Act 2023 Ruling on Hold

Supreme Court Puts Finance Act 2023 Ruling on Hold

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The Supreme Court of Kenya has temporarily halted sections of the Court of Appeal’s decision that declared the Finance Act 2023 unconstitutional.

The Supreme court

This move came after the National Treasury Cabinet Secretary, along with other government officials, filed appeals against the ruling.

The Finance Act 2023, which was passed earlier this year, faced a major setback on July 31, 2024, when the Court of Appeal nullified it. The court cited procedural errors during its enactment, throwing the government’s financial and operational systems into uncertainty. This prompted government officials to seek intervention from the Supreme Court.

During its deliberations, the Supreme Court focused on concerns regarding the legislative process used to pass the Finance Act.

In particular, there were issues surrounding public participation and whether the law adhered to Article 114 of the Constitution, which governs financial legislation. The Court highlighted the need for deeper judicial examination of these matters, which will be explored during the full appeal hearing.

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Conservatory Orders Issued

In response to these concerns, the Supreme Court issued conservatory orders to temporarily suspend the Court of Appeal’s ruling.

This allows the government to continue operating under the Finance Act while the legal issues are resolved. The Supreme Court stressed that these orders are critical to maintaining stability in public administration and preventing potential disruptions to government activities.

Impact on Taxpayers

For taxpayers, this ruling means that the taxes introduced under the Finance Act 2023 will continue to be collected for the time being. This is because the Supreme Court has suspended the Court of Appeal’s decision that had declared the entire Act unconstitutional. However, the fate of these taxes remains uncertain, as the Supreme Court is yet to make a final decision on the consolidated appeals. The final ruling will determine whether these taxes are constitutional and can continue to be enforced. If the Supreme Court upholds the Court of Appeal’s decision, it could have significant implications for government revenue and public spending.

Appeals Scheduled for September 2024

The consolidated appeals, which include Petitions E031, E032, and E033 of 2024, are set for a hearing in September 2024. The Supreme Court’s final ruling will be closely watched as it could have significant implications for Kenya’s legislative processes and the future of the Finance Act 2023.

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