Listen to This Article Enhance your reading experience by listening to this article.

The Supreme Court of Kenya was yesterday urged to uphold the Court of Appeal’s decision to declare the Finance Act 2023 unconstitutional.

The petitioners, among them Law Society of Kenya (LSK), Azimio la Umoja Coalition and the Katiba Institute argued that the Finance Act 2023 was not only flawed but also procedurally mishandled, asserting that the two appeals lodged against the Court of Appeal’s ruling lack merit.

The Court of Appeal’s decision to quash the Finance Act 2023 was based on multiple procedural and constitutional concerns.

The court found that certain sections of the Act, which were introduced post-public participation or failed to comply with constitutional requirements for public engagement.

Court of Appeal judges Kathurima M’inoti, Agnes Murgor and John Mativo emphasized that significant amendments to the Act after the initial consultation phase violated principles of transparency and inclusiveness, crucial components of Kenya’s legislative process.

Legislative process

The Court of Appeal’s decision also raised questions about the legislative process, particularly regarding the involvement of the Senate in bills affecting county functions.

In its submission to the Supreme Court, LSK supported the lower court’s decision, arguing that the Finance Act 2023 was enacted in violation of constitutional norms.

Through senior counsel Charles Kanjama, LSK emphasized that the Act’s passage bypassed critical procedural requirements, including adequate public participation and proper legislative scrutiny.

He argued that the government failed to adequately engage with those directly impacted by the Act’s provisions, including marginalized and illiterate populations.

“The process did not meet the constitutional requirement for meaningful public participation,” Kanjama contended. “Views from those most affected by the amendments were neither solicited nor considered, which is a fundamental flaw in democratic governance.”

The lawyer pointed out that amendments to the law were enacted without sufficient input from those who would bear the brunt of its financial implications.

This oversight, according to Kanjama, contravenes the principles of transparency and inclusivity set out in the Constitution, thereby invalidating the legislative process.

He argued that the Affordable Housing Act had repealed Section 84 of the Finance Act 2023, which had previously been a point of contention.

Specific issue

“With the repeal of the relevant section by the Affordable Housing Act, the specific issue regarding the Housing Levy has become moot,” Kanjama explained.

“There is now no substantive matter for the Court of Appeal to adjudicate concerning this provision,” he added.

The Azimio la Umoja Coalition also voiced strong support for the Court of Appeal’s decision to declare the Finance Act 2023 unconstitutional.

Through its legal representative, Arnold Ochieng, the coalition argued that the Act’s enactment was marred by significant deficiencies in transparency and accountability.

“The legislative process failed to uphold the basic tenets of democratic governance, particularly concerning the public’s right to participate meaningfully.”

Katiba Institute similarly supported the Court of Appeal’s decision.

It argued that the Court of Appeal’s ruling addressed critical issues related to public participation and the legislative process.

They argued that the failure to involve the Senate in the passage of sections touching on county functions further underscores the Act’s procedural flaws.

According to Katiba Institute, upholding the Court of Appeal’s decision is crucial for preserving the integrity of our constitutional framework and ensuring that laws are enacted in compliance with established legal standards.

The government through the Attorney General, Treasury Cabinet Secretary, National Assembly, and KRA want the Apex court to overturn the ruling against Finance act 2024 citing the economic crisis.

Githu Muigai, representing the AG and Treasury CS told the judges that the Act is crucial for the country’s economic stability and that its invalidation could precipitate a fiscal crisis.

Muigai emphasized that the Affordable Housing Levy remains a significant and active issue for the government.

“The question of how to enact an effective and constitutionally compliant tax statute is not just an academic exercise but a practical necessity for managing the country’s revenue,” he explained.