CS Mbadi Defends Tax Relief Plan Under Bottom-Up Agenda

Treasury Cabinet Secretary John Mbadi has defended the government’s proposed tax relief measures, saying they are aimed at putting more money into the pockets of ordinary Kenyans under the Bottom-Up Economic Transformation Agenda.

Speaking at a public event, Mbadi described himself as “a student” of the bottom-up model, saying he now fully understands its focus on supporting low-income earners.

“We have been told a number of times to put money in people’s pockets because their purchasing power has dwindled. If people say putting money back into the pockets of Kenyans is a campaign strategy, then it is okay,we should continue with it,” Mbadi said.

The CS explained that the proposal seeks to exempt earnings of up to Sh30,000 per month from taxation. He clarified that the relief would apply to the first Sh30,000 earned by all workers, regardless of their total income.

Under the proposed changes, Mbadi noted, the tax previously charged on the additional Sh6,000 — adjusted from the earlier Sh24,000 threshold — would result in savings of about Sh1,500 for affected workers.

“Someone earning Sh30,000 will feel that Sh1,500. It may look small to someone earning a million, but to a low-income earner, it makes a significant difference,” he said.

Mbadi added that the government is also proposing to reduce the tax rate on the next income band of Sh20,000 from 30 per cent to 25 per cent, offering further relief.

He said police officers, teachers, and other public servants earning around Sh30,000 had expressed excitement about the tax changes.

The CS maintained that the measures are intended to boost household incomes and stimulate economic activity by increasing disposable income among lower- and middle-income earners.

“If it is called a campaign tool and it gives money back to Kenyans, then it is a good campaign strategy,” Mbadi said, urging continued support for the policy direction.