KBA expects salaried workers to save Sh28bn in 5pc PAYE cut
The lobby group said the proposed tax cut would put more cash into workers’ pockets at a time when high cost‑of‑living pressures and rising statutory deductions have squeezed disposable incomes. Kenya breaking news | Kenya news today |..
✨ Key Highlights
The Kenya Bankers Association (KBA) has urged the government to implement a 5% reduction in Pay As You Earn (PAYE) taxes across all income brackets. This move is projected to save salaried Kenyans approximately Sh28 billion, boosting disposable incomes amidst high living costs and rising deductions.
- The proposed 5% PAYE cut is expected to return around Sh28 billion to salaried workers, translating to about Sh42 billion in additional GDP output.
- Raimond Molenje, CEO of KBA, stated this reduction would act as a "powerful economic stimulus," directly benefiting workers and driving broad economic growth.
- While the government, led by President William Ruto and Treasury Cabinet Secretary John Mbadi, has proposed targeted relief for lower-paid workers, KBA advocates for broader cuts to offset cumulative deductions like the National Social Security Fund (NSSF).
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Kenya Details Economic Initiatives Including PAYE Cut Proposal, Carbon Registry, and Projected Oil Earnings - February 2026
The Kenya Bankers Association (KBA) has urged the government to implement a 5% reduction in Pay As You Earn (PAYE) taxes across all income brackets. This move is projected to save salaried Kenyans approximately Sh28 billion, boosting disposable incomes. In a separate initiative, Kenya is launching a National Carbon Registry to bolster its climate finance infrastructure. The new system aims to provide a transparent and verifiable platform for tracking carbon credits and enhancing participation in global carbon markets. Furthermore, The National Treasury projects Kenya could earn between Sh136 billion and Sh371 billion from proposed oil development in Blocks T6 and T7. Cabinet Secretary for the National Treasury, John Mbadi, assured lawmakers the development would not create public debt for the government.
