Court dismisses petition on petroleum products VAT – Business Daily
Motorists fuel at the Kileleshwa Shell Petrol Station in Nairobi. PHOTO | SALATON NJAU | NMG
The High Court has dismissed a petition by Busia senator Okiya Omtatah four years ago challenging the imposition of tax on petroleum products.
Mr Omtatah filed the case in 2018 challenging the 16 percent VAT tax, arguing that it was illegal and amounted to double taxation.
Former President Uhuru Kenyatta intervened in 2018 and brought down the VAT to eight percent.
Justice Hedwig Ong’udi dismissed the case saying the court lacks the powers to interfere with the mandate of parliament.
“The only thing to do is for the Court to down its tools which I hereby do. The petition dated 5th September 2018 is found to have no basis and is hereby dismissed,” the judge said.
Mr Omtatah had argued the tax was imposed in defiance of an express decision by Parliament to suspend its implementation.
The new lawmaker had claimed that petroleum products were classified as exempt supplies for three years. The exemption was later extended by an amendment to the Finance Act, 2016 up until August 31, 2018.
The government defended the tax stating that the imposition of the VAT was based on the lapse of the transitional period and goods that were exempt became subject to VAT as required under Section 5(2) of the VAT Act, 2013. On double taxation, Treasury argued that Article 209 of the Constitution allows the imposition of other levies in addition to VAT.
Justice Ong’udi noted that the questions raised by Mr Omtatah revolve around policy issues that are specifically set out for Parliament.
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