TIMOTHY NJOYA & 17 OTHERS V ATTORNEY GENERAL & 4 OTHERSeKLR
|Petition 137 of 2011
|17 Jan 2013
Mohammed Abdullahi Warsame
High Court at Nairobi (Milimani Law Courts)
TIMOTHY NJOYA & 17 OTHERS V ATTORNEY GENERAL & 4 OTHERS
TIMOTHY NJOYA & 17 OTHERS V ATTORNEY GENERAL & 4 OTHERSeKLR
Reported by Andrew Halonyere &Cynthia Liavule
1. What happens when there is a direct and clear conflict between the transitional and consequential provisions, and the substantive provisions of the Constitution?
2. Whether the National Assembly as it has been saved under Section 10 of the Sixth Schedule to the Constitution of Kenya, 2010 implies that its members would be exempted from paying taxes on their allowances.
3. Whether there is a legitimate expectation by virtue of the existence of the National Assembly Remuneration Act (Cap 5) and section 6 of the Sixth Schedule to the Constitution.
4. Whether the taxation of allowances of members of parliament would amount to a violation of their right to property as envisaged under Article 40 of the Constitution of Kenya 2010.
5. Whether the executive arm of Goverment has powers to exempt any state officer from payment of tax.
6. Whether the High Court has jurisdiction to assess the amount of tax that is payable by anyone.
Constitutional law – public finance - taxation - taxation of income – where the Constitution makes provision that no class of state officers would be exempt from paying taxes - whether members of parliament were under an obligation to pay taxes – whether the executive arm of Goverment could exempt the members of parliament from paying taxes – whether the High Court had jurisdiction to determine the amount of taxes that any person could pay.
Statutes - interpretation of statutes – interpretation of constitutional provisions – Constitution to be read as an integrated whole – where there is a conflict between substantive provisions and transitional clauses – whether the substantive clauses should prevail – Constitution of Kenya, 2010 Articles 40,27,201,Sixth Schedule section 10, National Assembly and Remuneration Act section 5 (Cap 5).
Constitution of Kenya, 2010
Article 210(1) -There shall be no imposition, waiver or variation of tax or licensing fee except by legislation
Article 210(3) – No law may exclude or authorize exclusion of a state officer from payment of tax
Article 262 -Gives effect to the Transitional and Consequential provisions set out in the Sixth Schedule to the Constitution. The Article also preserves certain rights of Members of the National Assembly as presently constituted until the expiry of their term
Article 230 - Review of salaries of State Officers to be the exclusive duty of the Salaries and Remuneration Commission
National Assembly Remuneration Act section 5 (Cap 5) – provides that All allowances payable under the Act shall be exempt from income tax notwithstanding the provisions of any other written law relating to income tax.
1. The transitional provisions contained in the Sixth Schedule to the Constitution of Kenya, 2010 are intended to assist in the transition into the new order, but are limited in time and in operation and are to remain in force for the period provided in order to achieve the aspirations of Kenyans in moving into the new order. These transitional provisions are as much a part of the Constitution and as much an expression of the sovereign will of the people as the main body of the Constitution.
2. The Constitution must be read as an integrated whole, and that where there is a conflict between substantive provision and transitional provisions, then the substantive provisions of the Constitution would prevail. The role of the transitional clauses in the Constitution is to ensure a smooth shift from the old to the new order, while the role of the Constitution is to address and correct past injustices, and ensures that the citizens’ rights are protected in the future.
3. The National Assembly Remuneration Act would continue to be in force with regard to the remuneration of the members of the National Assembly. That legislation was enacted before the promulgation of the Constitution of Kenya 2010. The Act however, had to by virtue of section 7 of the Sixth Schedule to the Constitution, be brought into conformity with the Constitution. As a result, any legislation made by parliament or agreement that was made in violation of the provisions of the Constitution was void.
4. Nothing in the substantive provisions of the Constitution, nor in the Transitional and Consequential provisions in the Sixth Schedule suggested that any class of state officers would have been exempted from paying taxes on any part of their income. Had the intention been to exempt any state officers from the obligation of payment of tax, then that would have been expressly stated.
5. Article 210 of the Constitution provides that where it is envisaged that there will be a waiver or exemption from taxation, then it must be legislated and must also be reported to the Auditor General. Therefore it is not possible to claim that Members of the National Assembly have a right not to pay taxes on their allowances, exemption from taxation is a privilege, and not a right.
6. There was no legitimate expectation that Members of the National Assembly would have been exempted from payment of taxes.
7. The right to property under the Constitution encompasses the right to acquire and own any property, such as land, goods, intellectual property, money or negotiable instruments. The right to property does not encompass the right to be paid tax-free allowances for members of the National Assembly or for any sector of the society.
8. Article 210 has no exclusion or exemption in matters of taxation. Deviations were subject to judicial scrutiny. Any deviations must not be such as to deprive citizens of fair, transparent and effective tax regimes which are applicable to all in equal measure
9. Taxation is a civil duty, and under the Constitution, all State Officers are under an obligation to pay tax. Due to the supremacy of the Constitution, and the fact that the Constitution binds all persons, as well as the state, there can be no agreement that can exempt any State Officer from the payment of tax.
10. By virtue of section 3 (2) of the Sixth Schedule to the Constitution, the members of the National Assembly were entitled to set their own terms and benefits. That entitlement was however extinguished once the Salaries and Remuneration Commission was established. The court therefore did not have the jurisdiction to determine the amount of taxes that any person could pay. The court was also not in a position to determine the manner in which the National Assembly should allocate public money.
11. The executive could not donate an illegal or unlawful benefit and if it did, it was an act done in violation or contravention of the clear provisions of the Constitution, notwithstanding the consequences of the contravention. Equally, parliament or parliamentarians were not entitled to accept an unlawful advancement of monies belonging to the citizens of Kenya.
Cases referred to
1. Dennis Mogambi Mong’are v Attorney General & 3 others  eKLR (Petition No. 146 of 2011)
2. Executive Council of the Western Cape Legislature and Others v President of the Republic of South Africa and Others (CCT27/95) 
3. John Harun Mwau & 3 others V Attorney General & 2 others  eKLR (Constitutional Petition No. 65 of 2011 Consolidated with Petitions Nos 123 of 2011 and 185 of 2011)
4. Ng Ka Ling and others v Director of Immigration (Final Appeal No. 14, 15, 16 Of 1998 (Civil)
5. Council Of Civil Service Unions V Minister For Civil Service (1985) AC 375