Hello and welcome to the Money Weekly Newsletter, where we are covering the proposals that have been dropped from the Finance Bill 2026.

But first, a word from Hakki Africa.

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Treasury Drops 5 Proposals in Finance Bill 2026

The National Treasury has dropped five proposals, including a hike in rental income tax and a tax on mitumba imports, from the Finance Bill 2026 following concerns raised by the public.

Among the notable proposals withdrawn is the plan to increase residential rental income tax from 7.5% to 10%. 

The proposal was shelved amid concerns that it would prompt landlords to raise rent for tenants already struggling with the high cost of living.

Treasury also dropped the proposed tax on mitumba imports, which sought to impose a presumptive income tax on second-hand clothing and footwear imports. Traders had warned that the move would significantly increase clothing prices.

Nonetheless, Treasury CS John Mbadi had earlier indicated that the proposal could be reintroduced during the amendment stage.

According to the CS, the tax on second-hand clothing was a proposal put forward by the traders themselves.

Treasury has also withdrawn several other proposals from the Finance Bill 2026, including changes to excise duty regulations on imports from East African Community member states and a plan to exempt human and animal blood prepared for therapeutic and diagnostic use from VAT.

Additionally, it dropped a proposal to impose a Ksh50 per kilogram excise duty on imported ceramic sanitary ware, which had been intended to curb the undervaluation of imports.

The Finance Bill 2026 is currently under review by the National Assembly's Finance Committee, which is collecting views from stakeholders before tabling its report for debate in Parliament.

Meanwhile, Treasury clarified that the Finance Bill 2026 does not give KRA access to personal mobile money transaction data and does not introduce a 5% withholding tax on digital content monetisation.

Here is a quick recap of the top news stories for the week:

• The US has announced a Ksh1.74 billion package to support Kenya's Ebola preparedness efforts after reaching an agreement to establish a quarantine facility for Americans exposed to Ebola in the DRC. The planned 50-bed facility at Laikipia Air Base in Nanyuki would be staffed by more than 30 US public health officers. However, the High Court has temporarily suspended the project after the Katiba Institute and the Law Society of Kenya challenged the arrangement in court. 

• President William Ruto has said the proposal to make the first Ksh30,000 of monthly salaries tax-free will still be presented to Parliament despite concerns raised by some officials within the National Treasury over a Ksh40 billion budget shortfall. The proposed PAYE tax relief was expected to be included in the Finance Bill 2026 but was omitted when the Bill was published. It remains unclear whether the proposal will be introduced through a separate bill or as an amendment to the Finance Bill 2026.

• Metropolitan Sacco is facing growing liquidity pressure as members rush to withdraw their savings amid concerns over its financial stability. The sacco, which reported untraceable loans worth Ksh50 billion and negative equity of Ksh12 billion, has been ordered to refund several members by the Co-operative Tribunal. Meanwhile, 19 former officials have been charged over an alleged Ksh14.49 billion fraud scheme. 

• Education stakeholders have proposed introducing a standardised uniform for all public schools, with institutions retaining their identity through customised badges. The proposal, made during the Naivasha Education Conference, aims to reduce costs for parents and promote equality among learners. 

Catch Up on More News and Money Tips

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Panic Withdrawals Hit Metropolitan Sacco

Members of Metropolitan Sacco are moving to withdraw their savings following growing concerns about the Sacco’s financial position.

The Sacco had previously been described as financially strained, with reports pointing to loan recovery challenges, negative equity, and a rising loan default rate that affected its ability to meet member obligations.

The matter has since attracted legal and regulatory attention, with some members seeking intervention through the Co-operative Tribunal to recover their deposits.

Watch the video to learn more.

@money254hq

Panic Withdrawals Hit Metropolitan Sacco Members of Metropolitan Sacco are moving to withdraw their savings following growing concerns abo... See more

That’s a wrap for this week’s Money Weekly!

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