BY SAM ALFAN.
It is a win for alcohol drinkers following a court ruling that outlawed additional tax on drinks.
Increased tax would have translated to increased cost of alcoholic drinks as manufacturers would have increased the cost to cover the new tax.
However, the High Court in Nairobi declared KRA’s quest to widen the tax net on non-alcoholic drinks and cosmetics manufacturers unconstitutional.
Justice John Mativo ruled that a Legal Notice 110 of June 18 2013 and gazette Notice No.12856 of September 5 2013 were enacted in a manner inconsistent with the provisions of the constitution and the statutory instruments Act, hence they were null and void.
In the plan, KRA had moved to ensure manufacturers affix excise duty stamps on their products as way of ensuring they pay taxes while giving the taxman an indication of goods sold so as to determine the tax they required to pay.
In his judgment justice Mativo quashed the award of Tender number KRA/HQS/DP-423/2014/2-15 for the Excisable Goods Management Systems awarded by KRA.
“A declaration is hereby issued that public participation must apply to enactment of all subsidiary legislation and policy decisions through the degree and form of such participation will depend on the peculiar circumstances of the case, court ruled.
Activist Okiya Omtatah moved to court claiming that the new system would 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.