The High Court granted conservatory orders stopping the Kenya Revenue Authority from collecting minimum taxes pending the hearing and determination of petitions against the tax.
Justice George Odunga urged the tax agency to “hold its horses for the time being as this Court navigates through the labyrinth of the respective contentions made by the parties herein”.
…I grant conservatory orders restraining the 2nd Respondent [The Commissioner General, Kenya Revenue Authority] whether acting jointly or severally by itself, its servants, agents, representatives or howsoever otherwise from the implementation, further implementation, administration, application and/or enforcement of Section 12D of the Income Tax Act, Chapter 470 of the Laws of Kenya as amended by the Tax Laws (Amendment) (No.2) Act, 2020 by collecting and/or demanding payment of the Minimum Tax pending the hearing and determination of this Petition
Justice Odunga
A court order seen by The Kenyan Wallstreet further requires the National Assembly, the Commissioner General of the KRA, and the Attorney General to respond to within 7 days.
The court will meet on May 19th to further deliberate on the issue.
Today’s court order is a breath of fresh air for small businesses suffering from measures taken to control the pandemic such as the lockdown in Kajiado, Nairobi, Kiambu, Machakos and Nakuru counties, as well as the nationwide curfew.
The minimum tax kicked in on January 1, requiring businesses to pay a 1% levy on gross turnovers. Firms whose prices are regulated by the state, such as Oil Marketing companies, as well as those in the insurance sector are exempt from the tax.
