More taxes to be introduced in the 2025 Finance Bill; Finance Committee
More taxes to be introduced in the 2025 Finance Bill; Finance Committee
MP Kimani projects more taxes in 2025 Finance Bill in case of revenue, aid deficits.
Kuria Kimani, the MP for Molo and chair of the National Assembly Finance Committee, says the government might introduce tax increments in the 2025 Finance Bill in case of shortfalls in funding the 2025/26 financial year.
The National Assembly last month adopted the Ksh.4.3 trillion 2025/26 budget policy statement, of which Ksh.2.523 trillion is earmarked for national expenditure, some Ksh.200 billion higher than the allocation for the 2024/25 fiscal year.
Overall, the budget is also higher than the Ksh.3.95 trillion spending for the current year ending June.
In a Tuesday interview with NTV, Kuria said whether Kenya needs to raise more taxes in the new financial year is “a difficult conversation” as the country seeks to finance the additional spending.
Kimani said that between now and June, the Finance Committee will evaluate whether money from revenue collection, appropriation and aid will be sufficient to meet the higher ceiling, failure to which will mean additional taxation.
“If that will not be sufficient to fund the budget, that is when there will be additional tax measures to raise more revenue. If there is empirical evidence to show that the already existing tax measures, appropriations and donor commitments are enough to finance these ceilings, there will not be a need,” he told the broadcaster.
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Treasury Cabinet Secretary John Mbadi projects a 5.3 percent economic growth in 2025, up from 4.6 percent in 2024, driven by the agriculture, ICT, tourism, and industry sectors.
Even so, he has expressed worry about anticipated funding cuts from Kenya’s donor partners, such as the European Union, in the wake of the United States’ recent halting of all foreign assistance through USAID, of which Kenya was a beneficiary.
In late March, Mbadi said Kenya is forced to “look inward” moving forward and not rely on aid, even as it struggles to get its finances back on in the backdrop of high servicing costs to its Ksh.10 trillion external and domestic debt.
President William Ruto’s government was last year forced to scrap tax hikes worth Ksh.346 billion proposed in the 2024 Finance Bill after deadly youth-led demonstrations.
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