President William Ruto has proposed sweeping tax relief measures targeting low- and middle-income workers, including the elimination of Pay As You Earn (PAYE) tax for employees earning Sh30,000 and below. The Head of State announced the proposals on Wednesday, February 4, 2026, during an address to UDA aspirants at State House, Nairobi.
Under the proposal, workers earning up to Sh50,000 would also benefit from a reduced PAYE rate, with the tax lowered from 30 per cent to 25 per cent. The measures are aimed at easing the tax burden amid rising living costs.
The proposed tax changes are set to be formalised through a tax exemption bill, which the government plans to table in Parliament once it resumes for consideration and approval.
If approved by lawmakers, the measures would mark a significant shift in Kenya’s personal income tax framework, directly affecting millions of salaried workers and reducing the government’s reliance on PAYE collections from lower-income earners.
