Kenya plans to introduce zero income tax rate for salaries up to 32,333 shillings — The Rio Times

In Kenya, the Ministry of Finance plans to propose that parliament introduce a zero income tax rate for workers earning up to 32,333 Kenyan shillings per month, or about $249. The Rio Times reports. President William Ruto announced the initiative on October 20 during Heroes’ Day celebrations in the city of Eldoret, while Finance Minister John Mbadi presented the details on October 22.

How taxation will change

Currently, workers in Kenya pay 10% tax on the first 24,000 shillings of monthly income and 25% on the next 8,333 shillings. At the same time, a monthly tax relief of 2,400 shillings is deducted from the assessed tax.

Under the current rules, a worker earning 32,333 shillings pays 2,083 shillings in tax per month. If the initiative is adopted, they will not pay income tax, while the monthly tax relief will be abolished. Rates of 25%, 30%, 32.5%, and 35% for higher incomes are planned to be retained.

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The bill must be considered by parliament

According to the publication, the new approach could additionally exempt 362,846 formal-sector workers from tax. The Ministry of Finance is to submit the bill to parliament during the week beginning October 26, 2026. The document will then be considered by the parliamentary Finance and Planning Committee, after which it must be supported by lawmakers and signed by the president.

Until the legislative procedure is completed, employers will continue withholding tax from salaries under the current rules established by the Finance Act 2023. The package of changes also provides for the abolition of stamp duty on land transactions worth up to 1 million shillings and the 25% duty on mobile phone imports.