The Supreme Court of Kenya delivered a judgement on Tuesday issuing an order staying a Court of Appeal which rendered the country’s controversial Finance Act 2023 unconstitutional in its entirety. The seven-judge bench posited that the order was necessary due to public interest, among other reasons.

The Supreme Court while delivering this judgement, analyzed whether this appeal satisfied the conditions that determine the issuing of a stay of execution and the declaration of conservatory orders, as set out in the Gatirau Munya case. It first held that these measures were necessary because the appeal was not frivolous and required the input of the Supreme Court due to the implications of the judgement of the Court of Appeal. It also stated that failure to grant the stay would render the appeal inconsequential since, unlike the initial high court’s decision on the finance act that declared several sections unconstitutional, the decision of the court of appeal nullified the act wholly.

Finally, the court held that failure to grant the stay would be against the public interest because the public would suffer loss and uncertainty. According to the submissions of the appellants, a loss of 214B Kenyan shillings worth of revenue would be occasioned by the nullification of the Finance Act 2023. Further, the government would have to update its revenue collection systems to match those that existed in the regime of the Finance Act 2022 and this would take a lot of time. The revenue authority would also have to refund taxes collected under the Finance Act 2023 yet no allocation for refund exists.

Following the “reject finance bill” uprising by Gen Z in June, the president of Kenya declined to assent to the 2024 Finance Bill. He referred the bill back to the National Assembly which then unanimously voted to withdraw. The 2023 Finance Act was therefore set to continue operating as the law by which the Kenya Revenue Authority would follow in the collection of taxes in the country. However, on July 31, the Court of Appeal declared that the 2023 Finance Act was unconstitutional because it failed to satisfy the threshold of adequate public participation as required by the constitution of Kenya. The nullification of the Finance Act of 2023 meant that the Finance Act of 2022 was the viable legal framework to be used by the revenue authority to collect taxes.