In a bold move that will bring relief to millions of Kenyan workers, President William Ruto has overruled Treasury concerns and approved tax exemptions for low-income earners. Speaking at the National Prayer Breakfast at Safari Park in Nairobi, the President confirmed that workers earning up to Sh30,000 monthly will no longer pay PAYE tax.
The decision comes despite warnings from Treasury CS John Mbadi that the tax relief could cost the government approximately Sh40 billion in the current budget. When Treasury officials raised concerns about the financial impact, Ruto’s response was direct: “Let’s do it. Let’s do it.”
Currently, workers earning up to Sh24,000 pay PAYE at 10%. Under the new directive, this group, along with those earning up to Sh30,000, will be completely exempt from income tax. The President emphasized that the country can fund development through innovative approaches without overburdening low-income workers.
Treasury CS Mbadi had previously stated that the PAYE relief didn’t feature in the proposed Finance Bill 2026, citing the need for simulations and economic assessments. The government was also exploring ways to widen the personal income tax base to offset the revenue loss.
According to projections, the tax relief will result in net pay gains ranging from Sh731 to over Sh2,000, depending on income levels. Additional proposals include lowering the 30% tax bracket to 25% for middle-income earners, providing further relief across the board.
For more details on this developing story, visit the full report at https://nairobiwire.com/2026/05/ruto-paye-tax-relief-low-income-earners-sh30000-kenya-2026.html
This policy shift represents a significant victory for Kenya’s working class and demonstrates the government’s willingness to prioritize citizens’ welfare despite fiscal constraints. As implementation details emerge, millions of Kenyan workers can look forward to keeping more of their hard-earned income.