ELDORET, Kenya —Workers earning up to KSh 32,800 per month could soon be exempted from Pay As You Earn (PAYE) tax under a government proposal aimed at increasing take-home pay for low-income earners.
Treasury Cabinet Secretary John Mbadi announced the proposed tax relief during the Mashujaa Day 2026 Economy Thematic Week at Eldoret National Polytechnic in Uasin Gishu County.
The proposal seeks to cushion low-income households against the rising cost of living by allowing eligible employees to retain more of their monthly earnings.
If approved, workers earning within the proposed threshold would no longer have PAYE deducted from their salaries, although other statutory deductions could still apply.
The Treasury is expected to present the proposed changes to Parliament for consideration, with the new tax arrangement subject to legislative approval before implementation.
The planned exemption comes amid growing pressure on the government to ease the financial burden on ordinary Kenyans struggling with the cost of food, transport, housing and other essential needs.
However, the proposed tax relief is not yet in force, and employees will continue to be taxed under the existing rules until any approved changes take effect.