Economy
Treasury suffers new setback in taxes implementation plan
Friday July 21 2023
National Treasury and Economic Planning Cabinet Secretary Njuguna Ndung’u poses for a photo with a briefcase containing the 2023/2024 budget statement before proceeding to Parliament Building on June 15, 2023. PHOTO | LUCY WANJIRU | NMG
The Treasury suffered another setback in its quest to implement the contentious Finance Act after the Court of Appeal declined to lift an order suspending the law.
The bench of three judges said it will rule on the application by Treasury Cabinet Secretary Njuguna Ndung’u, who argued that the suspension of the Act was affecting government operations, on July 28.
Read: CJ Martha Koome picks judges to hear case against Finance Act
Prof Ndung’u moved to the appellate through Attorney-General Justin Muturi arguing that the government stood to lose approximately Sh211 billion in the current financial year, which would make it difficult for the Kenya Kwanza administration to implement the 2023/24 budget as planned. He further said some projects have had to be suspended.
“The Government of Kenya has to borrow to bridge the gap in order to operate. As there are no saving provisions in the Finance Act, 2023, the repealed provisions of the Finance Act 2022 has the effect of affecting revenue collection leading to service disruptions for already budgeted revenue,” Prof Ndung’u said in an affidavit.
High Court Judge Mugure Thande stopped the Treasury from implementing the Act on June 30, after ruling that Kenyans might be subjected to unlawful taxes, in case the petitions challenging the Act are successful.
The judge on July 10 declined to lift the suspension and directed the file to be forwarded to Chief Justice Martha Koome for appointment of a bench to determine the petitions challenging the Act.
Justice Koome has already picked High Court judges David Majanja, Christine Meoli and Lawrence Mugambi to determine the cases.
Read: What next if the Finance Act is stopped by court?
Arguing before Justices Mohamed Warsame, Kathurima M’Inoti and Hellen Omondi, former Attorney General Githu Muigai, who is leading a team picked by Mr Muturi, submitted that the suspension will make the government incapable of meeting its financial commitments and discharging its executive authority.
