Court now declares Robin Hood taxes illegal, faults CS Rotich


Court now declares Robin Hood taxes illegal, faults CS Rotich
Treasury CS Henry Rotich during a briefing on the Credit Management Bill

In Summary

  • The two issues of concern were whether it was procedural for Treasury to start collecting the taxes proposed in the Finance Bill 2018 before enactment.
  • Bankers had wanted the Robin Hood tax declared illegal since there was no public participation.

The High Court has faulted Treasury CS Henry Rotich saying he did not follow the Constitution when he presented the Finance Bill 2018.

This means that the tax imposed on mobile money transfer, imported vehicles, and bottled water is unconstitutional.

“….the provisional collection of Taxes and Duties Act 415 and the provisional collection of taxes and duties 2018 fail the constitutional test of validity,” Justice Wilfrida Okwany ruled.

According to the judge, the Finance Bill 2018 cannot be implemented before it becomes Finance Act.

She further stated that the Bill should have gone through the Parliamentary legislative process laid out in the constitution for approval and adoption by parliament and final assent by the president.

The issue of concern were whether it was procedural for Treasury CS Rotich to order collection of the taxes proposed in the Finance Bill 2018 before its enactment.

Bankers had also wanted the Robin Hood tax declared illegal since there was no public participation.

Activist Okiya Omtata had moved to court seeking to have National Treasury and Kenya Revenue Authority barred from implementing any taxes proposed in the Finance Bill 2018.

According to him, the Kenyan taxpayer must be protected from exposure to taxes which have not been approved by parliament contrary to Article 210(1) of the constitution.

He said the Bill seeks to introduce a number of amendments to the tax regime to mobilise revenues to finance the Government’s Ksh.3trillion budget.

“This matter is urgent because the respondent have begun implementing or imposing taxes proposed in the finance Bill 2018 before the same is considered and approved by the National Assembly,” Omtata argued.

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Story By Dzuya Walter
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