New taxes on phones, digital payments, rent and gambling spark fresh public debate.
Kenyans could soon pay more for mobile money transactions, smartphones, rent and online services if the proposed Finance Bill 2026 is passed by Parliament.
The new bill tabled by the government as part of plans to raise revenue for the 2026/27 financial year has already triggered nationwide debate with many Kenyans expressing concern over the rising cost of living and increased taxation on digital services.
The government says the proposed law aims to widen the tax base, improve revenue collection and reduce overreliance on salaried workers. However, critics argue that some of the proposals may place additional pressure on ordinary citizens, small businesses and the digital economy.
Among the most controversial proposals is the planned increase of excise duty on mobile phones from 10 percent to 25 percent. If approved, the move is expected to push smartphone prices higher at a time when many Kenyans rely heavily on mobile devices for communication, online business, banking and education.
The bill also proposes new Value Added Tax charges on several digital financial services including mobile money transaction fees, card processing charges and online payment systems. This means services such as mobile transfers and digital payments could become more expensive for millions of users across the country.
Landlords are also expected to feel the impact after the government proposed increasing Residential Rental Income Tax from 7.5 percent to 10 percent. Economists warn that the additional tax burden could eventually be transferred to tenants through higher rent prices.
The Finance Bill 2026 further targets Kenya’s growing digital and cryptocurrency sector through tighter taxation and reporting requirements. Virtual asset service providers and crypto-related businesses may be required to share transaction information with the Kenya Revenue Authority (KRA) under proposed compliance rules aimed at improving tax monitoring.
In another major proposal, KRA is set to receive expanded enforcement powers including the ability to access more taxpayer information, automate compliance systems and issue agency notices even in cases where disputes are still before courts or tax tribunals. Supporters say the move could help curb tax evasion while opponents fear it may expose taxpayers to unfair enforcement.
The government has also proposed fresh changes in the betting and gambling sector including tighter taxation and a 20 percent tax on gambling winnings. Betting firms are expected to face stricter oversight as authorities continue efforts to regulate the fast-growing industry.
Several excise duty changes contained in the bill may also affect the prices of cigarettes, sugary drinks and selected imported products. Some VAT exemptions could also be removed or adjusted, potentially affecting prices in different sectors of the economy.
At the same time, the government is proposing another tax amnesty programme that would allow individuals and businesses with unpaid taxes to clear their principal tax obligations while penalties and interest are waived if payments are completed before the set deadline.
The proposed Finance Bill comes less than two years after the controversial Finance Bill 2024 which triggered widespread public anger and anti-government protests across the country. As a result, many Kenyans have been closely monitoring the new proposals with growing concern over possible economic impact.
Despite criticism, Treasury officials insist the bill is designed to stabilize the economy, increase government revenue and spread taxation more fairly across different sectors instead of placing the burden mainly on employed Kenyans.
The Finance Bill 2026 is still a proposal and must undergo public participation, parliamentary debate and possible amendments before it can become law. If approved by the National Assembly and signed by the President, most changes are expected to take effect from July 2026.
As debate intensifies, attention now shifts to Parliament where lawmakers will face increasing pressure from both the government and the public over the future of the proposed tax measures.