Hard truths. Bold Insights. Real talk.
Addressing the media on Monday , the CS said the government was correcting widespread misunderstanding of the proposals and insisted that many controversial measures circulating in public debate do not appear in the current Bill.
Parliament described the reports as false and misleading, insisting the Bill has no clauses related to land ownership or land rent. It also denied claims that a separate law on freehold land conversion had been passed or signed.
The National Assembly’s Finance and National Planning committee has started public stakeholder engagements on the Finance Bill, 2026. Consultations run until May 29 as Parliament seeks views on proposed tax measures expected to raise about Sh117 billion.
The proposed Finance Bill,2026 is set to introduce several tax adjustments aimed at widening revenue collection without introducing major new taxes.
Speaking during a Radio Generation interview on Monday, Otieno defended discussions around wealth tax, transparency, and accountability, arguing that Kenya’s taxation challenges are tied to weak public trust, poor service delivery, and limited transparency in public finance management.
Speaking during a press briefing in Nairobi on Monday, the CS said reforms such as a simplified “mitumba” tax regime, reduced phone import taxes, and a shift in filing timelines are aimed at easing business costs, improving efficiency, and boosting revenue collection rather than raising prices, stressing that “there is miscommunication around this.”
Among those set to benefit are kidney patients after Treasury proposed VAT exemptions on dialysers and related medical supplies used in dialysis treatment. The move is expected to lower the cost of treatment for patients battling chronic kidney disease.
The Finance Bill 2026 additionally proposes an increase in residential rental income tax from 7.5 per cent to 10 per cent. The proposal is backed by enforcement measures, including agent-based withholding systems aimed at improving compliance.
Odhiambo also raises issues with the proposed tax treatment of mitumba imports. The Bill introduces a new Section 12H in the Income Tax Act, which assumes a 5% profit on customs value and requires payment before goods are released by the Kenya Revenue Authority. She says this means a trader bringing in goods worth Sh1 million would pay Sh50,000 whether or not they make profit or loss, calling the approach unfair.
Agriculture Cabinet Secretary Mutahi Kagwe said the proposed measures are intended to ease cash-flow pressures, unlock reinvestment, and address long-standing concerns by exporters over delayed VAT refunds and high levies that have constrained growth.
Under the suggested structure, earnings below Sh30,000 would not attract PAYE. Income between Sh30,001 and Sh50,000 would be taxed at 15 per cent, while those earning between Sh50,001 and Sh100,000 would pay 20 per cent. A rate of 25 per cent would apply to income from Sh100,001 to Sh400,000, with any amount above Sh400,000 taxed at 30 per cent.
The National Treasury has invited Kenyans and key stakeholders to submit evidence-based tax amendment proposals for the 2026/2027 Budget and Finance Bill 2026, with submissions due by December 31, 2025.