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Court okays the Finance Act

The Court of Appeal has today given the Finance Act, 2023, a lifeline after lifting the suspension imposed on the implementation of the new law to pave the way for the ambitious budgetary proposal.

In a ruling delivered this afternoon by a three-bench judge, the appellate court presided over by Justice Mohamed Warsame, Kathurima M’Inoti, and Hellen Omondi gave the National Treasury the greenlight to operationalize the act, which appeared to have sparked a wave of protests across the country.

The decision comes after Busia Senator Okiya Omtatah and six others secured a High Court order putting the Kenya Kwanza’s Ksh3.6 trillion budgetary projections on hold until the matter was determined.

However, the government opposed the decision through Attorney General Justin Muturi after Treasury Cabinet Secretary Njuguna Ndungu pleaded with the court to lift the suspension, arguing that the country was likely to plunge into a financial gridlock.

“The application by (the state) has merit, and the same is allowed as prayed with the effect that the order made on July 10, 2023, suspending the Finance Act 2023, and the order prohibiting the implementation of the Finance Act 2023, be and is hereby lifted pending the hearing and determination of the appeal,” the ruling read in part.

The appellate court gave the act a 90-day grace period before the next set of budgets takes shape, adding, “We have no doubt that the finance act and the appropriation act are independent; while the former provides for the generation of resources, the letter provides for expenditure.”

Owing to the scenario, the bench stressed that “there can be no expenditure where the mode of generation of funds has not been provided for.”

Chief Justice Martha Koome appointed High Court judges David Majanja (presiding judge), Lady Justice Christine Meoli, and Justice Lawrence Mugambi to hear and determine the case on July 18.

The enactment of the act has elicited mixed reactions across the country, with the opposition brigade led by Azimio la Umoja leader Raila Odinga calling for a countrywide protest against the new tax measures under the new law.

By Victor Obure

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