NAIROBI, Kenya – Nairobi County’s plan to raise revenue has suffered a major setback after the High Court declared its Finance Act, 2023, unlawful for failing to meet constitutional and statutory requirements.
In a judgment delivered by Justice Bahati Mwamuye, the court found that the county government introduced new fees and levies without first formulating a clear tariff and pricing policy, as required under the Constitution and the County Governments Act.
“The petitioner’s uncontroverted evidence shows that Nairobi City County did not develop, adopt, publish, or implement any tariffs and pricing policy before enacting the impugned Finance Act, 2023,” Justice Mwamuye stated.
The ruling stems from a case filed by Nairobi resident Jared Ngisa Nyabuto, who challenged the legality of the Finance Act, arguing that the county had imposed arbitrary charges without consulting the public or justifying the cost of services.
Neither the county executive, the assembly, nor its speaker responded to the petition.
The court ruled that all fees introduced under the 2023 law were null and void and ordered the county to revert to the previous Finance Act of 2022 or any earlier applicable legislation.
“Accordingly, the levies, rates, and fees imposed by law and in force immediately before the enactment of the Nairobi City County Finance Act, 2023, which has been quashed, shall now continue to apply,” said the judge.
The now-invalidated Act had introduced sweeping changes that burdened residents and businesses. Among the most contentious increases were:
- Reserved parking fees hiked from Sh1,000 to Sh1,500 per day
- Loading zone permits up from Sh220,000 to Sh250,000 annually
- Display fees for vehicles on road reserves raised from Sh10,000 to Sh15,000 per square metre
- General alcohol retail licenses surged from Sh25,000 to Sh100,000
- Taxi-hailing application fees jumped from Sh1,000 to Sh5,000
- CBD saloon car parking fees rose from Sh200 to Sh300 in non-automated zones
The judgment marks a significant win for residents and traders who had decried the cost implications of the new charges and the lack of public involvement in the decision-making process.
Justice Mwamuye emphasized that no new financial measures can be implemented in the future without strict adherence to legal guidelines, including public participation and evidence-based pricing structures.
