Kenya’s low-income workers are about to get significant financial relief as President Ruto pushes through a Sh40 billion tax exemption package. This bold move will eliminate PAYE tax for anyone earning Sh30,000 or less per month, putting more money directly into workers’ pockets.
Let’s break down what this means for your finances. Currently, workers earning up to Sh24,000 pay 10% PAYE, which translates to Sh2,400 monthly or Sh28,800 annually. Under the new policy, this entire amount stays in your account. For someone earning Sh30,000, the savings could be even more substantial.
The proposals also include raising the tax-free threshold to Sh30,000 and reducing the 30% tax bracket to 25% for middle-income earners. According to government projections, workers will see net pay increases ranging from Sh731 to over Sh2,000 monthly, depending on their income levels.
Treasury CS John Mbadi initially resisted the move, citing concerns about revenue loss and the need for economic simulations. However, President Ruto insisted on implementing the relief despite the Sh40 billion cost to the national budget. The government plans to offset this loss by widening the personal income tax base.
For workers who have been struggling with the high cost of living, this relief couldn’t come at a better time. The extra money can be used for essential expenses, savings, or investments. Financial experts recommend using tax savings wisely—consider building an emergency fund, paying down debt, or investing in income-generating activities.
Read the complete coverage at Nairobi Wire (https://nairobiwire.com/2026/05/ruto-paye-tax-relief-low-income-earners-sh30000-kenya-2026.html).
To make the most of your extra income, consider financial planning tools like budgeting apps (YNAB, Mint) or investment platforms. Books like “The Total Money Makeover” by Dave Ramsey can also help you build better money habits.