Budget and Beyond: CS John Mbadi

On 1 July, the first day of the new financial year, National Treasury Cabinet Secretary John Mbadi joined Jeff Koinange Live to explain what the Finance Act 2026 means for ordinary Kenyans.

Mbadi said the Finance Bill was never meant to raise revenue through new taxes or higher rates. The focus, he said, was on reform: simplifying tax administration and making the system easier to comply with. He pointed to several measures he said would have been lost if what he called propaganda against the bill had carried the day.

The headline was a tax amnesty. Taxpayers with arrears up to December 2025 have six months, until 31 December 2026, to pay only the principal amount, with all interest and penalties waived. He also highlighted the removal of tax on dialysis machines to make kidney treatment more affordable, and changes to stagger tax-return deadlines so that not every Kenyan files at the last minute in June.

Jeff pressed him on debt. Mbadi explained why the government is now borrowing more at home than abroad. He recalled the panic in early 2024 over a $2 billion Eurobond repayment, when the shilling slid to around 160 to the dollar and, he said, added about a trillion shillings to the debt stock "without taking a shilling." As a middle-income country, he added, Kenya gets fewer cheap concessional loans, and commercial borrowing abroad now costs upwards of 10%.

Domestic rates, by contrast, had fallen sharply from the highs of 2024, he said, though they had started to rise again. When Jeff pushed for exact numbers, Mbadi insisted the government is borrowing more cheaply than it has in years. For households and businesses, the real test will be whether that relief shows up in prices and jobs.