The Supreme Court on Tuesday, August 20 issued a conservatory order temporarily suspending a Court of Appeal decision that declared the Finance Act 2024 as unconstitutional.
The order was issued following an appeal filed by the National Treasury and four other government officials against the Court of Appeal’s decision.
“A conservatory order is hereby issued suspending and staying the declarations in Orders iii, iv, vi, vii & ix(i) issued in the Court of Appeal judgment dated 31st July, 2024 in Civil Appeals Nos. E003, E016, E021, E049, E064 & E080 of 2024 (Consolidated) pending the hearing and determination of the consolidated appeal before this Court,” read part of the ruling.
While issuing the order, the Supreme Court stressed the importance of maintaining governmental stability and avoiding disruptions in public administration.
On July 31, the Court of Appeal declared the Finance Act 2023 unconstitutional.
In a ruling by a three-judge bench comprised of Judges Kathurima M’Inoti, Agnes Kalekye Murgo, and John Mativo, the court noted that the Act was fundamentally flawed and therefore unconstitutional.
“Having found that the process leading to the enactment of the Finance Act, 2023 was fundamentally flawed and in violation of the Constitution, sections 30 to 38, 52 to 63, and 23 to 59 of the Finance Act, 2023 stand equally vitiated and therefore unconstitutional,” the ruling read.
The three-judge bench pointed out that a tax can only be levied if a lawfully enacted statute provides that the burden of taxation must be fairly shared, that the revenue raised by a tax may only be used for lawful public purposes, and that public money must be used in a prudent and responsible manner.
Meanwhile, the Supreme Court has set a timeline for further proceedings in the case, with virtual hearings scheduled for 10 and 11 September 2024, commencing at 9 am each day.
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