Kenya Revenue Authority attempt to have activist Okiya Omtatah deposit security has failed.
The activist is challenging the proposed excise stamps on bottled water, juices, soda, nonalcoholics drinks, food supplements and cosmetics that are manufactured locally or imported products.
Justice John Mativo said that public interest litigation was meant to enforce constitutional rights and a requirement for security of costs would create an unnecessary barrier to aggrieved citizens.
Further the court directed the Kenya Revenue Authority (KRA) to file responses to the petition.
Justice Mativo also declined to lift conservatory orders suspending the new taxation regulation that was to take effect from November 1 this year.
“It is not enough to plead that a court order is causing hardship. It must be demonstrated that there are justifiable grounds to warrant the court to disturb its orders,” Justice Mativo said.
The learned judge extended the sanctions he imposed on October 30 pending the outcome of the dispute.
In the case Okiya is challenging the taxman’s decision, communicated in legal notices published on June 18 and September 5, 2013, creating the Excisable Goods Management System (EGMS) without public participation and sanction by the National Assembly.
Omtatah claims that the new system will illegally and unconstitutionally expose manufacturers, importers and consumers to the burden of meeting extra production costs.
“Contrary to the requirements of the Fair Administrative Action Act 2015, the EGMS was arbitrarily imposed without public participation involving all stakeholders, including, the affected manufacturers, importers, and consumers,” Omtatah said in his petition.
KRA’s directive was to come into effect from November 1.
In a notice in September KRA had indicated that all juice, bottled water, plastic bottled sodas, food supplements, energy drinks and cosmetics manufactures and importers will need to have the excise duty stickers on their products.
Currently an estimated 186 bottled water manufacturers and 28 soft drinks and juices manufacturers licensed by the authority pay tax.