Treasury Cabinet Secretary John Mbadi has proposed several changes to the tax system to enhance revenue collection in the country.
Through the 2026/27 Budget, Mbadi proposes that taxpayers with no income start submitting their tax returns within one month after the end of the tax year. This move aims to give the Kenya Revenue Authority (KRA) sufficient time to audit tax returns before the start of the new financial year.
Mbadi also noted that some companies have been delaying the payment of dividend tax by retaining profits for long periods. To counter this, the government proposes that companies distribute at least 60% of their undistributed earnings.
Furthermore, the Treasury plans to update tax laws to align with technological advancements and digital commerce. These changes aim to establish a clear framework for taxing digital transactions and reduce the loss of government revenue.
