PROCESSED FOR EXPORT

Court blocks Kiunjuri's tax on hides and skins

Constitution requires government to impose taxes for services, but processed hides fall under Trade ministry

In Summary

• Court grants application by Tanners Association, says imposition of levy by Kiunjuri is illegal.

• Court says if any tax is imposed, it should be by the Trade ministry. 

CS for Agriculture Mwangi Kiunjuri
CS for Agriculture Mwangi Kiunjuri

The High Court yesterday barred the Agriculture ministry from imposing a tax on processed hides and skins for export.

Tanners Association chairman Robert Njoka argued the ministry's decision to impose a levy on processed products violated the consent dated April 22, 2016, and adopted as the decree of Court on April 25, 2016.

Justice John Mativo yesterday barred the ministry from imposing and collecting taxes from the association's members for goods destined for export. He said the matter falls under the trade, not the Agriculture and Livestock ministry.

“Legal notice No.300 of 2017 was adopted in a manner inconsistent with constitutional and statutory requirements. The moment violation of the Constitution or breach of a statutory requirement becomes evident, as in this case, the rebuttable presumption of constitutionality of a statute ceases to operate,” Mativo ruled.

Agriculture and Livestock CS Mwangi Kiunjuri only addressed the question of public participation and said nothing about all the other requirements enumerated in Section 13 of the Act, the court said.

A tax burden on the Tannery Association members can only be imposed after a scrupulous adherence to the law, the judgement reads.

Lawyer Mwang’ombe Mwakio representing the tanners argued that leather development is under the Trade ministry. Therefore it is unreasonable for Kiunjuri to charge a levy on the industrial product whose operations are not within his ministry, he said.

The lawyer said the CSacted irrationally by gazetting rules that penalise value addition and violate government policy on leather development.

The minister acted in bad faith by ignoring the objections by the association and then Trade CS Adan Mohamed before gazetting the rules imposing cess on the processed hides/skins, he said.

Kiunjuri, responding through PS Harry Kachuwai, said members of the association were to comply with terms of consent, which provided that any levy or cess to be charged be agreed upon and justified by the stakeholders before gazettement.

The judge barred Kiunjuri from imposing or collecting cess from tanners' association members. 

 

(Edited by R.Wamochie)