News and Analysis
October 22, 2026
Hello and welcome to the Money News Roundup. Today, we explore the proposed PAYE tax changes and how they will affect your payslip. We also look at the rising cost of extending the SGR to Malaba.
Treasury Cabinet Secretary John Mbadi has proposed raising the tax-free monthly income threshold from Ksh24,000 to Ksh32,333, exempting an additional 362,846 formal sector workers from paying income tax.
As reported by the Business Daily, the changes will eliminate the Ksh2,400 personal relief currently available to workers while increasing taxes for higher-income earners to offset revenue losses.
Under the proposals, those who earn between Ksh32,334 and Ksh50,000 will see their income tax decrease by up to Ksh596.
Employees earning Ksh60,000 will see their monthly income tax increase by Ksh473, as those earning Ksh100,000 will have their income tax increase by Ksh892.
The monthly income tax for those earning Ksh200,000 will increase by Ksh3,867.
The number of formal sector workers exempt from income tax is expected to rise from 1.32 million to 1.69 million.
Mbadi said the Treasury would present the proposals to Parliament for approval next week. The government also plans to scrap stamp duty on property transactions below Ksh1 million and remove the 25% import duty on mobile phones.
The Treasury has increased the budget for extending the Standard Gauge Railway (SGR) from Naivasha to Malaba to Ksh651 billion, up Ksh148 billion from the previous estimate of Ksh502.9 billion.
While the reasons behind the increase are still unclear. The Business Daily reports that Ksh618.8 billion of the total project cost is expected to come from external financing.
The government plans to raise funds through revenue securitisation, including bonds backed by future Railway Development Levy collections.
The government also plans to involve private investors in providing locomotives, passenger coaches and freight wagons, with investors recovering their costs through passenger and freight charges.
The extension will pass through Narok, Bomet, Kericho, Nyamira, Kisumu, Siaya, Kakamega, Vihiga and Busia counties. Already, Ksh25 billion is expected to be used for land compensation.
China Communications Construction Company and its subsidiary, China Road and Bridge Corporation, have been selected to extend the railway.
Kenya’s banking sector contributed a record Ksh205.58 billion in taxes in 2025, up 5.53% from Ksh194.81 billion in 2024, according to the Kenya Bankers Association (KBA).
As reported by Citizen Digital, the seventh edition of its total tax contribution report showed that 33 participating banks accounted for 22.15% of corporate taxes collected by the government and 8% of total tax revenue.
The contribution comprised Ksh98.36 billion in taxes borne and Ksh107.22 billion collected on behalf of the government.
KBA urged the government to review income taxes to stimulate economic activity and ease compliance costs.
Safaricom has launched Fuliza Ya Pochi, an overdraft facility enabling eligible Pochi La Biashara merchants to access credit when their business wallets run low.
As reported by Capital Business, launched in Thika on October 22, 2026, the service allows traders to pay suppliers, restock, transfer money and settle bills despite insufficient balances.
Eligible merchants must have actively used Pochi La Biashara for over six months. Credit limits will depend on business activity, with repayments automatically deducted from subsequent wallet deposits.
Merchants can access the service through My OneApp’s Pochi Mini App or by dialling *334#.
Airbnb will ban hosts from requiring guests to strip beds, wash and put away dishes or take rubbish off-site under new rules for reservations booked from November 20.
As reported by the New York Times, the policy prohibits hosts from introducing new house rules after bookings or imposing fines for failing to complete such tasks. Hosts must disclose all house rules on listing pages before guests reserve accommodation.
Guests must still follow rules that comply with Airbnb’s policies, although exceptions apply where local conditions, such as drought or wildlife risks, justify certain requests.
Violating hosts risk warnings, listing amendments and reduced visibility in search results if problems persist.
Kenya has purchased its High Commission building in London for about Ksh2.84 billion (£16.25 million), securing a 999-year lease to reduce diplomatic rental costs.
As reported by the Business Daily, a parliamentary report shows the government has paid the full amount for the property at 45 Portland Place, with title registration pending. The acquisition is expected to save Kenya approximately Ksh103 million annually in rent.
The purchase forms part of a 15-year programme launched in 2021 to acquire properties for diplomatic missions abroad. Kenya has also purchased property in New York and plans similar acquisitions in Geneva, while exploring public-private partnerships to develop diplomatic facilities in six African countries.
Also in the News
Kakuzi Plc has issued its fifth profit warning since 2021, projecting significantly lower 2026 earnings as falling macadamia prices and reduced crop volumes weigh on performance. The NSE-listed firm’s latest warning, dated October 21, follows an August notice forecasting a profit decline of at least 25%. Kakuzi posted a net profit of Ksh387.6 million in 2025 but reported a 97.6% drop in first-half 2026 earnings to Ksh7.1 million. Read more
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