President William Ruto revealed the modified proposition on Tuesday, October 20, stating the federal government means to lower the tax concern on all employees, especially those making modest wages.
“We have actually prepared a proposition to exempt Kenyans making Ksh32,333 each month or less from paying PAYE earnings tax. For employees on modest earnings, every shilling conserved suggests more cash for food, transportation and school costs,” he stated.
Speaking throughout the 63rd Mashujaa Day events at Kipchoge Keino Stadium in Uasin GishuRuto stated he had actually currently directed the National Treasury to provide it to Parliament next week for factor to consider.
President William Ruto checking a guard of honour throughout the 63rd Mashujaa Day Celebrations at Kipchoge Keino Stadium in Eldoret on Tuesday, October 20, 2026.
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“I have actually directed the National Treasury to put these propositions before Parliament next week,” he included.
The President stated the federal government would follow the needed legal and financial procedures to guarantee the proposed tax relief is carried out in a more sustainable and transparent way.
“These steps attend to the barriers that Kenyans challenge today. The essential legal and financial procedures will follow, with attention to sustainable funding, openness and efficient execution,” he specified.
The current modified proposition shifts from the preliminary strategy revealed by the federal government in May this year, which looked for to exempt employees making Ksh30,000 each month or less from PAYE.
Under the existing system, employees pay 10 percent tax on the very first Ksh24,000 they make month-to-month and 25 percent on the next part approximately Ksh32,333, with greater earners paying more.
Kenyans making above Ksh32,333 to Ksh500,000 are subtracted 30 per cent monthly, while those making above Ksh500,000 are taxed at the rate of 32.5 per cent.
A month-to-month individual relief of Ksh2,400 efficiently offsets the PAYE payable by staff members making up to Ksh24,000, suggesting they typically pay no earnings tax after the relief is used.
The proposition is not yet in result and should go through the needed legal procedures before any modifications to the existing PAYE structure can be executed by the National Treasury.
Treasury CS John Mbadi speaking throughout an occasion at State House, Nairobi, on June 30, 2026.
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