In a major relief for low-income earners, President William Ruto has overruled the Treasury to eliminate PAYE tax for workers earning up to Sh30,000 monthly. Speaking at the National Prayer Breakfast at Safari Park in Nairobi, Ruto confirmed the government will proceed with the tax relief despite Treasury concerns about a Sh40 billion budget impact.
The move targets workers currently earning between Sh24,000 and Sh30,000, who have been paying PAYE at 10%. “We are talking about low-income earners who currently pay PAYE at 10%. We want them to stop paying,” Ruto declared, dismissing Treasury CS John Mbadi’s cautious approach.
Mbadi had earlier indicated that the PAYE relief didn’t feature in the Finance Bill 2026, citing the need for revenue simulations and economic impact assessments. However, Ruto’s directive makes it clear the policy will move forward regardless. “The Treasury came back and said this is going to cost us Sh40 billion. I told them, ‘Let’s do it,’” the President stated.
The relief is expected to benefit millions of Kenyan workers, with projected net pay gains ranging from Sh731 to over Sh2,000 depending on income levels. The government also plans to widen the personal income tax base to offset revenue losses and lower the 30% tax bracket to 25% for middle-income earners.
For workers struggling with the high cost of living, this represents tangible relief. If you’re looking to maximize your new take-home pay, consider investing in a personal finance guide like “The Total Money Makeover” to build better money habits and secure your financial future.
Read the full story on Nairobi Wire: https://nairobiwire.com/2026/05/ruto-paye-tax-relief-low-income-earners-sh30000-kenya-2026.html