The National Treasury has once again pushed back its timelines to review Pay As You Earn (PAYE) tax bands for low-income earners, with Cabinet Secretary John Mbadi announcing that public engagement will now begin in October 2026.
The CS had previously promised to table a tax amendment Bill in Parliament by the end of September. However, speaking on Tuesday, September 15, Mbadi confirmed that the Treasury will first launch a public participation exercise in the first week of October before submitting the finalized bill to lawmakers.
Mbadi attributed the pushback to a congested September legislative calendar, planned foreign travel, and the legal imperative of conducting thorough public consultations to avoid litigation risks.
“It is coming. I will do the public participation first. Kenya has become what it is because of the Constitution that we have. If I bring them without public participation, someone might go to court to stop it. Sometimes it can be very discomforting,” Mbadi stated.
He noted that public engagements will start in early October before taking a brief pause while he attends the International Monetary Fund (IMF) and World Bank Annual Meetings.
“This month is a bit crowded. I will do it immediately in the first week of October,” he explained. “I will break it when I am going for the spring meeting, then come back and conclude it, then we process the Bill through the National Assembly.”
Overview of Proposed Tax Relief
If approved by Parliament, the proposed adjustments will restructure personal income tax bands to provide financial relief to low- and middle-income salaried workers:
Under the initial framework, employees earning up to Ksh 30,000 per month would be granted a complete exemption from paying PAYE altogether. At the same time, workers earning between Ksh 30,001 and Ksh 50,000 would see their applicable PAYE rate lowered to 25 per cent.
After public participation concludes, the proposals will be structured into a Tax Laws Amendment Bill for debate and enactment by the National Assembly.
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