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Post Reply: High Court Petition Seeks to Halt Kenya’s Finance Act 2025 Over Economic Hardship Concerns

<blockquote><div class="quotetitle">Quote from <a class="profile-link highlight-moderator" href="https://lawguide.co.ke/understanding-law/legal-forum/profile/lawyer/">Lawyer</a> on July 11, 2025, 9:02 am</div><div id="pl-6926"  class="panel-layout" ><div id="pg-6926-0"  class="panel-grid panel-no-style" ><div id="pgc-6926-0-0"  class="panel-grid-cell"  data-weight="1" ><div id="panel-6926-0-0-0" class="so-panel widget widget_sow-editor panel-first-child panel-last-child" data-index="0" data-style="{&quot;background_image_attachment&quot;:false,&quot;background_display&quot;:&quot;tile&quot;,&quot;background_image_size&quot;:&quot;full&quot;,&quot;background_image_opacity&quot;:&quot;100&quot;,&quot;border_thickness&quot;:&quot;1px&quot;}" ><div
			
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	<p dir="ltr" data-pm-slice="0 0 []">Nairobi, Kenya - On July 9, 2025, a significant legal challenge was mounted against Kenya’s Finance Act 2025, as petitioner Godfrey Musania filed a case in the High Court to suspend its implementation. Signed into law by President William Ruto on June 26, 2025, the Act has sparked controversy for its potential to exacerbate economic difficulties for millions of Kenyans. The petition, which names Treasury Cabinet Secretary John Mbadi, the Attorney General, and the Kenya Revenue Authority (KRA) as respondents, argues that the law’s provisions violate constitutional principles and threaten the well-being of citizens.</p>
<p dir="ltr">The petition centers on the claim that the Finance Act 2025 was enacted without adequate public participation, a cornerstone of Kenya’s constitutional framework. Musania contends that several sections of the Act were introduced at the committee stage without public input, rendering them unconstitutional. Specifically, the removal of Value Added Tax (VAT) exemptions on essential goods, such as mosquito repellents and construction materials, is highlighted as a measure that will disproportionately harm low-income households.</p>
<p dir="ltr">The petitioner argues that the elimination of VAT exemptions on mosquito repellents could reverse progress in combating malaria, a major public health concern in Kenya. By increasing the cost of these products, the Act may limit access for vulnerable populations in malaria-endemic regions, potentially threatening lives. Musania asserts that this constitutes an unjustifiable limitation on the right to life, as enshrined in Article 26 of the Kenyan Constitution.</p>
<p dir="ltr">Additionally, the petition claims that the Act’s provisions will drive up the cost of living, exacerbate health risks, and infringe on economic and property rights. Without court intervention, Musania warns, the implementation of these measures, which began on July 1, 2025, will cause irreversible harm to the public.</p>
<p dir="ltr">Musania is seeking conservatory orders from the High Court to suspend the contested sections of the Finance Act 2025 pending a full hearing. He has requested that Justice Lawrence Mugambi declare these sections unconstitutional and issue an injunction to halt their enforcement. Furthermore, the petitioner is asking for the respondents—Mbadi, the Attorney General, and the KRA—to bear the costs of the legal proceedings.</p>
<p dir="ltr">The urgency of the petition stems from the immediate economic impact of the Act. Musania argues that the increased costs of essential goods and services will place an unbearable burden on Kenyans already grappling with economic challenges. The petition emphasizes that the government’s failure to engage the public meaningfully during the legislative process undermines the democratic principles enshrined in the Constitution.</p>
<p dir="ltr">The filing of this petition comes amid growing public dissatisfaction with economic policies under President Ruto’s administration. The Finance Act 2025 has been criticized for prioritizing revenue generation over the welfare of ordinary citizens. Social media platforms have been abuzz with sentiments echoing the petition’s concerns, with many Kenyans expressing frustration over the rising cost of living and perceived lack of transparency in governance.</p>
<p dir="ltr">This legal challenge is not an isolated case. President Ruto’s administration has faced multiple court petitions over various policies, including the Affordable Housing Bill, university funding models, and the appointment of Independent Electoral and Boundaries Commission (IEBC) commissioners. Critics argue that these policies often lack sufficient public consultation, a recurring theme in Musania’s petition against the Finance Act.</p>
<p dir="ltr">The government has defended the Finance Act 2025 as a necessary measure to address fiscal challenges and support national development priorities. The Act is part of a broader strategy to increase revenue collection, with the KRA tasked with implementing new tax measures. However, the removal of VAT exemptions on essential goods has drawn particular scrutiny, as it directly affects the affordability of basic necessities.</p>
<p dir="ltr">The petition highlights the potential economic fallout, particularly for low-income households and small businesses. By increasing the cost of construction materials, the Act could hinder infrastructure development and raise housing costs, further straining Kenya’s economy. The petitioner argues that these measures risk deepening poverty and undermining public trust in the government.</p>
<p dir="ltr">The High Court, under Justice Lawrence Mugambi, is expected to review the petition and determine whether to grant the requested conservatory orders. The respondents have been directed to file their responses, and a hearing date will be set to address the substantive issues raised in the case. If the court grants the conservatory orders, it could temporarily halt the implementation of the contested sections, providing relief to Kenyans while the legal challenge is resolved.</p>
<p dir="ltr">The outcome of this case could have far-reaching implications for Kenya’s fiscal policy and the balance between revenue generation and public welfare. A ruling in favor of the petitioner could compel the government to revisit the Finance Act and ensure greater public participation in future legislative processes. Conversely, if the court upholds the Act, it may embolden the government to pursue similar tax measures, potentially intensifying public discontent.</p>
<p dir="ltr">The petition has garnered attention from activists, civil society groups, and opposition leaders, who view it as a critical step in holding the government accountable. Many have praised Musania for challenging what they describe as an oppressive law, while others have called for broader reforms to address systemic economic challenges. The case has also reignited debates about the role of public participation in Kenya’s legislative process, with advocates emphasizing the need for transparency and inclusivity.</p>
<p dir="ltr">As the nation awaits the court’s decision, the petition underscores the growing tension between the government’s fiscal policies and the economic realities faced by ordinary Kenyans. With the cost of living continuing to rise, the outcome of this legal challenge could shape public perception of President Ruto’s administration and its commitment to addressing the needs of its citizens.</p>
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