Big Win for Govt, Tough Break for Kenyans as Supreme Court Clears Path for Finance Act 2023

Chief Justice Martha K. Koome

The Supreme Court has overturned the Court of Appeal's judgment with regard to the 2023 Finance Bill by declaring it constitutional.

The Supreme Court gave this verdict after lower courts had earlier declared unconstitutional the Finance Act 2023, citing a lack of sufficient public participation in its legislative process.

In a statement on Tuesday, October 29, the Supreme Court announced that "the preliminary objection on this Court's jurisdiction is overruled," adding, "We hereby set aside the Court of Appeal's finding declaring the whole Finance Act, 2023 unconstitutional."

The apex court ruled that public participation in the enactment of the Finance Act 2023 was conducted legally, consequently differing from the verdict of the lower court.

The appeal consolidated issues relating to the legislative processes that led to the passage of the Finance Bill, which had received presidential assent on June 26, 2023.

The Supreme Court affirmed two critical conclusions reached by the Court of Appeal: notably that the question touching on Section 84, which effected the Affordable Housing Levy, had become moot.

The Supreme Court, therefore, held that in agreeing with the Court of Appeal, sections 76 and 78 of the Act, amending the Kenya Roads Act and the Unclaimed Financial Assets Act, were unconstitutional since their provisions were not incidental or related to a Money Bill as contemplated in the Constitution.

A total of 11 petitions from 49 respondents challenging the constitutionality of the Finance Act 2023 had been received by the High Court.

According to the petitioners, the number of the provisions were beyond what was considered a Money Bill as outlined in Article 114 of the Constitution.

They also argued that the concurrence requisite was not accorded between the Speakers of the National Assembly and those of the Senate to the passage of the bill through the legislative process.

The issues of the Affordable Housing Levy and part of the Statutory Instruments Act had been rendered moot by the Court of Appeal earlier.

It also dismissed the cross-appeals, finding them devoid of merit, save to declare that the High Court had erred in its view as to the scope of its authority in Article 165(3) since the said Article relates to policy matters.

The cross-appeal asked for an order directing a refund of all taxes collected from the date of the enactment of the Act.