The Court of Appeal has lifted an order suspending the Finance Act, 2023 following an application by Treasury CS Prof Njuguna Ndung’u.
This gives the government power to collect revenue based on the proposed 2023 Finance Act.
The Appellate Court lifted the order issued last month suspending the implementation of the Finance Act 2023 after the High Court orders were challenged by Treasury CS.
According to the Court of Appeal, Treasury CS Prof Ndung’u argued that the government loses half-a billion shillings daily, following the freeze of the Act.
The three judges bench agreed with the CS hence okaying the Finance Act 2023 pending the determination of an appeal filed by Prof Ndung’u.
The CS moved to the appellate court through Attorney General Justin Muturi arguing that the government stands to lose approximately Sh211 billion in the current financial year.
Further, Ndung’u said the freeze will make it difficult for the Kenya Kwanza administration to implement the 2023/24 budget as planned and some projects have to be suspended if the government is not allowed to raise revenue as proposed in the Bill.
The Appellate Court Justices Mohammed Warsame, Kathurima M’Inoti and Hellen Omondi ruled that the Finance Act has a life span of 90 days beyond which the next budgetary cycle is set in motion.
“We have no doubt in our mind that the Finance Act and the Appropriation Act are interdependent. While the former provides for generation of the funds, the latter provides for the expenditure. There can be no expenditure where the mode of generation of the funds has not been provided for,” ruled the Judges.
The judges said Prof Ndung’u had estimated to generate Sh211 Billion with an average daily rate of Sh500 million.
“Despite the actual figures being contested, it is certain that revenue was to be collected with the operationalization of the Act,” concluded the Judges.
