The Constitutional and Human Rights Division of Kenya's High Court, through Petition 253 of 2018, on 20 July ordered that provisions introduced by the Finance Bill, 2018¹ be suspended pending the hearing and determination of a petition filed by Mr. Okiya Omtata Okoiti (the Petitioner), a human rights activist against the National Treasury, Kenya Revenue Authority (KRA), the National Assembly and the Attorney General. The Petitioner argued that the implementation of the provisions of the Finance Bill, 2018 were in violation of the provisions of the Kenyan Constitution.

In addition, the Kenya Bankers Association (KBA) had also tabled Petition 235 of 2018 against the Attorney General and the KRA. Conservatory orders were also granted by the Court to delay implementation of paragraph 6 of Part II of the First Schedule of the Excise Duty Act which introduces duty at a rate of 0.05% of the money transferred by banks until a time the term "money transferred by the banks" will be defined in the Act.

Next steps

• The hearing of the matters filed under the petitions are scheduled for 31 July 2018 and 17 September 2018, respectively.
• Pending the hearings, it is recommended that taxpayers prepare for the implementation of the proposed changes even though proposed taxes are not due to the KRA during the period that the conservatory order is effective.
• The Finance Bill is currently being debated in the National Assembly before it is enacted into law.

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ENDNOTE

¹ See EY Global Tax Alert, Kenya issues 2018/2019 budget, dated 21 June 2018.

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CONTACTS

For additional information with respect to this Alert, please contact the following:

Ernst & Young (Kenya), Nairobi

• Francis Kamau
  francis.kamau@ke.ey.com
• Catherine Mbogo
  catherine.mbogo@ke.ey.com
• Christopher Kirathe
  christopher.kirathe@ke.ey.com
• John Gikima
  john.gikima@ke.ey.com
• Stephen Ndegwa
  stephen.Ndegwa@ke.ey.com

Ernst & Young (Uganda), Kampala

• Hadijah Nannyomo
  hadijah.nannyomo@ug.ey.com

Ernst & Young Advisory Services (Pty) Ltd., Africa ITS Leader, Johannesburg

• Marius Leivestad
  marius.leivestad@za.ey.com

Ernst & Young LLP (United Kingdom), Pan African Tax Desk, London

• Rendani Neluvhalani
  rendani.mabel.neluvhalani@uk.ey.com
• Byron Thomas
  bthomas4@uk.ey.com

Ernst & Young LLP, Pan African Tax Desk, New York

• Silke Mattern
  silke.mattern@ey.com
• Dele A. Olaogun
  dele.olaogun@ey.com

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ATTACHMENT

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