The Supreme Court on Tuesday quashed the nullification of the controversial Finance Act 2023 by the Court of Appeal handing the President William Ruto government a major win.

The move now hands the government full mandate to apply the 2023 finance law to meet its revenue targets after widespread riots forced Ruto to withdraw the Finance Act 2024.

In July 2024, the Court of Appeal declared unconstitutional the Finance Act 2023, but the Supreme Court set aside the decision until an appeal filed by the government is determined.

The government uses finance laws to outline measures for raising revenue but was forced to continue applying the 2023 Finance Act to collect taxes after the collapse of this year’s law.

“We hereby set aside the Court of Appeal's finding declaring the entire Finance Act 2023 unconstitutional,” ruled the Supreme Court, which is headed by Chief Justice Martha Koome.

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Activists led by Bungoma Senator Okiya Omtatah rushed to court and challenged the 2023 finance law after demonstrations led by the opposition rocked various parts of the country.

Ruto, via Finance Act 2023, introduced a raft of tax-raising measures among them double VAT on fuel, hiked the top personal income tax rate, and also unveiled the Housing Levy.

However, a bid by the Kenya Kwanza administration to intrude a fresh round of hikes on tax hit a snag in 2024 following deadly demos from June that left more than 50 people dead.

Ruto was forced to eat humble pie and withdraw the divisive 2024 Finance Act that was passed by MPs after Gen Z protesters led riots into the National Assembly staling business.

He had defended his heavy tax measures terming them necessary for growth even as the finance law collapse delayed the release of fresh loans from International Monetary Fund.

The Head of State has also urged Kenyans to endure and support his revenue-raising measures saying they were badly needed to enable Kenya pay off her huge foreign debts.

On Wednesday, the Executive Board of the IMF is scheduled to converge to endorse the disbursement of a loan to Kenya after fulfilling set targets in a revised loan programme.