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Treasury Cabinet Secretary John Mbadi has stated that the government has improved the payslips of Kenyans. According to Mbadi, the tax relief measures will be reflected in the first pay slip of January.
Speaking on Monday, he clarified that he defines a middle-class earner as someone earning between Sh60,000 and Sh150,000.
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“We’ve enhanced people’s payslips, although sometimes the conversation around thinner payslips gets exaggerated,” Mbadi commented during a discussion on NTV.
He added that the new tax policies are a relief for Kenyan workers, highlighting that both the housing levy and the Social Health Insurance Fund (SHA) are no longer double-taxed.
Mbadi defended the government’s tax policies, rejecting claims that they are too burdensome, particularly for middle-income earners.
“There’s this perception that we are overtaxing. I’ve reviewed the taxes because I wanted to improve payslips,” he said.
In a detailed breakdown shown to MPs at the National Assembly Mid-Term Retreat in Naivasha, Mbadi explained the tax impact for individuals earning Sh100,000 per month, a typical middle-class salary in Kenya.
He pointed out that the introduction of the Housing Levy and SHA has been misunderstood as excessive taxation. For instance, he explained, someone earning Sh100,000 previously paid Sh2,750 for SHA, but with the new laws, the amount has dropped to Sh1,925, with the difference being just an additional Sh225 compared to the previous NHIF contribution of Sh1,700.
“People with higher salaries may feel the pinch of taxes more, but for the middle class, the impact isn’t as severe,” Mbadi concluded.
His remarks come amid rising public dissatisfaction over the cost of living and the growing number of deductions from salaries. Critics have accused the government of overburdening citizens with multiple taxes, including the Housing Levy and SHA.
