The International Monetary Fund (IMF) is keeping a close watch on the court case concerning the suspended Finance Act 2023 in Kenya.
The IMF executive board had approved it stating it was “crucial to support ongoing consolidation efforts to reduce debt vulnerabilities.”
“Depending on what comes out from the courts against the Finance Act, we will regroup with the authority to look at the contingency plans in place, our discussions will depend on parts of the act the High Court will do away, or if it blocks completely implementation of the law,” said IMF Mission Chief for Kenya, Haimanot Teferra.
“The government thinks the Finance Act is constitutional and will hold.”
Teferra, said, “However, recent challenges in resource mobilization and elevated uncertainty call for contingency plans that can be quickly deployed to ringfence fiscal performance going forward.”
“Tighter financing conditions also require a prudent debt policy and continued efforts to prioritize concessional loans,” she added.
Teferra expressed confidence in the measures taken by the Central Bank of Kenya (CBK) to moderate the shillings against the dollar.
The Finance Act 2023 Proposals
These include the Income Tax Act, Value Added Tax Act, Excise Duty Act, Tax Procedures Act, Tax Appeals Tax Act, Employment Act 2007, Miscellaneous Fees and Levies Act 2016, Betting, Gaming and Lotteries Act, Kenya Roads Board Act, Kenya Revenue Authority Act, Alcoholic Drinks Control Act, Unclaimed Financial Assets Act, Statutory Instruments Act 2013, Special Economic Zones Act, Export Processing Zones Act and Retirement Benefits (Deputy President and Designated State Officers) Act.
Chief Justice Martha Koome appointed three judges on Tuesday to hear and determine several petitions challenging the Finance Act, 2023 whose implementation was halted by the High Court on June 30.