Finance Bill 2026 Published as Treasury Unveils New Tax Proposals

The government has officially published the Finance Bill 2026, setting the stage for fresh tax and revenue measures expected to shape the country’s economic and business landscape in the next financial year.

According to a statement issued by the Parliament of Kenya, the Bill was published on May 5, 2026 after being submitted to the National Assembly of Kenya by the Cabinet Secretary for the National Treasury.

The proposed law contains wide-ranging amendments targeting several tax laws, including the Income Tax Act, Value Added Tax Act, Excise Duty Act, Tax Procedures Act, Miscellaneous Fees and Levies Act, and the Stamp Duty Act.

Parliament said the Bill seeks to introduce new revenue-raising measures as the government moves to strengthen tax collection and expand the fiscal space amid rising expenditure pressures and debt obligations.

Among the notable proposals highlighted in the Bill is a plan to amend the Road Maintenance Levy Fund Act by reducing allocations made to the Road Annuity Fund from Sh3 to Sh1.50 per litre of fuel levy collections.

The changes come as the government continues reviewing infrastructure financing models amid budget constraints and increasing public debt servicing costs.

The Finance Bill 2026 also contains several proposals that have already sparked debate among businesses and consumers.

One of the most controversial measures is the proposed 25 per cent excise duty on mobile phones, a move likely to significantly raise smartphone prices in Kenya if approved by Parliament.

The government argues that the levy will improve tax compliance within the digital economy and strengthen revenue collection by targeting mobile devices at the point of activation.

Another proposal attracting attention is the introduction of a new presumptive tax regime on mitumba imports. Under the proposal, imported second-hand clothes would attract VAT at importation, after which authorities would assume a five per cent profit margin and apply a one-off 30 per cent income tax on the presumed earnings.

Treasury officials say the approach is aimed at simplifying tax administration and sealing loopholes associated with under-declaration of income among some traders.

However, traders and consumer groups fear the measures could increase the cost of second-hand clothing and place additional pressure on low-income households already grappling with the high cost of living.

The Bill is also expected to contain broader reforms affecting excise taxes, compliance procedures and business levies as the government seeks to increase domestic revenue mobilisation.

The publication of the Bill now opens the public participation phase, where Kenyans, businesses and stakeholders will submit views to Parliament before lawmakers debate and potentially amend the proposals ahead of approval.

The Finance Bill 2026 can be accessed through the official Parliament of Kenya website.

Read: 7 Key Proposals in Kenya’s Finance Bill 2026 and Why They Are Sparking Debate

>>> Explained: Why Finance Bill 2026 is Introducing 5% Tax on Mitumba and 25% Excise Duty on Mobile Phones