The National Assembly Departmental Committee on Finance and National Planning has intensified scrutiny of the Finance Bill, 2026, holding extensive consultations with officials from the National Treasury and the Kenya Revenue Authority (KRA) as lawmakers prepare to finalize their report on the proposed legislation.
During separate sessions chaired by Molo MP and Committee Chairperson Kuria Kimani, Members of Parliament presented concerns raised by stakeholders and members of the public during recent public participation forums held across 13 counties.
The lawmakers sought clarification on the policy rationale behind several contentious proposals contained in the Bill, including taxes on imported mobile phones, digital financial transactions and betting winnings.
“We have invited you here because we want to seek clarification on a number of issues raised during our engagements with stakeholders and the public,” Kimani said.
Appearing before the committee, National Treasury Principal Secretary Dr. Chris Kiptoo defended the proposed reforms, saying they are intended to strengthen the efficiency, fairness and sustainability of Kenya’s tax system while supporting implementation of the 2026/27 Budget.
“Hon. Chair, this Bill seeks to simplify tax compliance, expand the tax base, reduce revenue leakages, rationalize tax expenditures, modernize tax administration and enhance domestic revenue mobilization in a manner that supports businesses, creates jobs and promotes economic growth,” said Kiptoo.
Among the issues raised by legislators were the proposed taxation of imported mobile phones at the point of activation, review of Pay As You Earn (PAYE) tax bands, mandatory use of the electronic Tax Invoice Management System (eTIMS) for claiming business expenses, taxation of betting winnings and the proposed Value Added Tax (VAT) on digital financial transactions.
Kiptoo told the committee that the Finance Bill is expected to generate approximately Sh98 billion in additional revenue, with enforcement measures under the Tax Procedures Act projected to contribute Sh36.3 billion of the total.
However, committee members emphasized the need for a stable and predictable tax regime, arguing that frequent policy changes could undermine investor confidence and economic planning.
The legislators also called for improved revenue forecasting by the National Treasury to ensure future revenue projections are realistic and achievable.
In a separate session, the committee met newly appointed KRA Commissioner-General Adan Mohamed, who briefed lawmakers on tax administration reforms, enforcement measures and plans to expand the country’s tax base.
Members sought further clarification on the proposed mobile phone activation tax, the enforcement of KRA agency notices and the extension of the ongoing tax amnesty programme.
While congratulating Mohamed on his appointment, lawmakers urged him to spearhead reforms aimed at improving revenue collection and enhancing efficiency within the tax authority.
Mohamed noted that a relatively small number of taxpayers currently shoulder the country’s tax burden and pledged to broaden compliance across various sectors of the economy.
“Hon. Chair, very few Kenyans carry the burden of taxation in this country. Only about 12,000 companies pay taxes due to them. This has to change. For instance, while we have the potential to collect Sh100 billion from rental income tax, we are only collecting Sh16 billion,” he said.
The Commissioner-General, who has been in office for three weeks, pledged to work closely with Parliament to improve KRA’s performance and strengthen domestic revenue mobilization.
The committee is expected to use the submissions and clarifications provided by the Treasury and KRA to finalize its report on the Finance Bill, 2026, ahead of debate and consideration by the National Assembly.
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