Court of Appeal declines to lift order on fuel tax

A station attendant fuels a car along Koinange Street in Nairobi. [Boniface Okendo, Standard]

Kenyans have a reason to smile over Christmas after the court declined to suspend a High Court order barring the government from effecting a new tax levy on petroleum products.

The Court of Appeal found that the Kenya Revenue Authority (KRA) had jumped the gun as it had not argued its case before the High Court on why the temporary order should be lifted.

Judges Asike Makhandia, Jamilla Mohammed and Imana Laibutta ruled KRA had not proved the taxman would suffer if they did not intervene.

“We are persuaded that the circumstances of the application before us does not call for stay of further proceedings in the High Court.

The intended appeal from the interim orders in issue is frivolous and in vain and can only serve to stand in the way of inter partes hearing and determination on the merits of the respondents’ motion in the High Court,” the appellate court ruled.

KRA moved to the appellate court after Justice James Makau barred it from demanding excise tax from oil marketers, effectively cushioning Kenyans from high fuel prices. The orders affected fuel cost adjustment cycle that began on October 1. “Pending the hearing and determination of this application inter partes, this court be pleased to issue temporary conservatory orders quashing the decision by the Commissioner General of KRA to adjust excise duty rates for petroleum products effective October 1, 2021,” ruled Justice Makau.

The case was filed by Isaiah Odando and Wilson Yata through lawyer Kenneth Amondi. They argued that the new levies subjected Kenyans to suffering.

Should the court agree with their petition and suspend the new tax laws, it will be a huge relief to the public. The Energy and Petroleum Regulatory Authority last week announced new cost of fuel. A litre of petrol went up by Sh7.58, diesel went up by Sh7.95 while kerosene went up by Sh12.97.

However, this did not reflect at the pump as the increased costs were shouldered by Petroleum Development Levy. 

 

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