Ex-Nairobi governor Sonko gets relief as Tribunal directs KRA to unfreeze his bank accounts
The orders will remain in force as the Tribunal hears and determines Sonko's substantive appeal challenging KRA's tax demands.
Former Nairobi Governor Mike Sonko has won temporary relief in his ongoing tax battle after the Tax Appeals Tribunal directed the Kenya Revenue Authority (KRA) to lift agency notices that had frozen his bank accounts.
In a decision delivered by Tribunal chairperson Dr Rodney Oluoch, the panel ordered the taxman to immediately withdraw the notices issued to Equity Bank and Co-operative Bank, which had blocked Sonko from accessing funds in his personal and business accounts.
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The orders will remain in force as the Tribunal hears and determines Sonko's substantive appeal challenging KRA's tax demands.
The Tribunal found that the disputed taxes at the centre of the row had not yet been conclusively assessed, and therefore could not be enforced. According to Dr Oluoch, Section 52(2) of the Tax Procedures Act shields taxpayers from enforcement actions where objections or appeals are still pending.
"The taxes that formed the basis of the agency notices are contested and remain undetermined. They are therefore not recoverable at this stage," the Tribunal held, faulting KRA for moving ahead with collection measures before the appeal was resolved.
Sonko's lawyers had accused the revenue authority of acting precipitously and in disregard of due process by issuing notices that effectively immobilised millions of shillings.
They argued that the agency notices amounted to punitive action against their client despite the existence of a live dispute before the Tribunal.
KRA, however, insisted it had acted within its mandate and maintained that the assessments were proper. But the Tribunal disagreed, ruling that allowing the notices to stand would prejudice the appellant and undermine the purpose of tax dispute mechanisms that require matters to be heard first before enforcement.
The decision hands Sonko a crucial interim victory, granting him access to his bank accounts while his challenge to the tax assessments proceeds.
The Tribunal will now turn to the core question of whether the assessments and penalties issued by KRA were lawful, accurate, and supported by evidence.
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