Treasury Cabinet Secretary John Mbadi at the floor of the house reading budget statement for the year 2026-2027 at Parliament Building in Nairobi on June 11, 2026./DOUGLAS OKIDDYTreasury Cabinet Secretary John Mbadi has defended the government's decision not to introduce new taxes or increase existing tax rates in the 2026 Finance Bill, saying the move is intended to protect Kenyans from additional financial pressure.
Mbadi said the government had instead focused on reforms aimed at improving tax administration, enhancing efficiency and broadening the tax base rather than imposing new tax burdens on households and businesses.
Presenting the 2026/27 Budget Statement in Parliament on Thursday, the CS said the proposals were informed by extensive public consultations conducted over the past year and lessons drawn from the events that followed the 2024 Finance Bill.
"In preparing these proposals, I have been guided by the overriding principle of placing the well-being of the common mwananchi first. In this regard, I have deliberately chosen not to introduce new taxes or increase tax rates that would further overburden the hardworking Kenyans and their families," Mbadi said.
He said the government had prioritised measures to improve tax collection, promote fairness in the tax system and expand the revenue base without increasing the burden on taxpayers.
The CS linked the decision to the aftermath of the June 25, 2024, protests, saying the events underscored the need for government to listen to citizens and involve them in policymaking processes.
"Government was reminded of the need to always listen to the voices of our citizens," he said.
Mbadi told Parliament that he personally led public engagement forums across the country while preparing the budget and related policy proposals.
He said he met youth groups, business people and other stakeholders to gather views on the budget and the Finance Bill. He also cited engagements through various media platforms and discussions with university students as part of the consultation process.
"I wish to thank all Kenyans who took time to attend these forums and engage with me. My assurance is that their voices have been reflected in the proposals that I am presenting today," he said.
Despite ruling out new taxes and tax rate increases, Mbadi said the government would continue efforts to widen the tax net to ensure more Kenyans contribute to financing public services.
He noted that only 3.1 million working Kenyans currently contribute Pay As You Earn tax, even as millions of other income earners participate in the economy.
"Only 3.1 million working Kenyans contribute to PAYE, yet millions of other Kenyans who make money in our economy do not contribute to the taxes we collect," Mbadi said.
The CS said many potential taxpayers continue to file nil returns despite earning income, leaving a small group of compliant taxpayers carrying a disproportionate share of the country's tax burden.
"The burden of development in this country has been borne by a few of us, and that must change," he said.
Mbadi said broadening the tax base would help the government raise additional revenue while creating room to ease pressure on taxpayers who consistently meet their tax obligations.
