The success of Kenya's newly enacted Finance Act 2026 that takes effect from July 1, will depend less on the taxes it raises and more on how transparently the government spends the revenue collected, tax lobby groups have warned.
In a joint forum convened by National Taxpayers Association and OXFAM, the stakeholders noted that public concerns have shifted from the introduction of new tax measures to whether taxpayers will receive value for money from the Sh4.8 trillion national budget.
The Finance Act 2026, which takes effect on July 1, has largely been viewed as less punitive than previous tax measures after several controversial proposals were dropped following public participation and consultations with stakeholders.
Speaking after a stakeholder forum on the Finance Act, NTA chief executive Patrick Nyangweso said many Kenyans are willing to meet their tax obligations but remain sceptical because of persistent concerns over corruption, wasteful spending and poor service delivery.
"The issue is no longer just about paying taxes. Citizens want to know what happens after they pay taxes," said Nyangweso.
According to the stakeholders, the legislation focuses more on expanding the tax base,
strengthening tax administration and bringing previously untaxed sectors into
the formal tax system rather than imposing significant new taxes on already
compliant taxpayers.
However, tax experts argue that expanding revenue collection alone will not be enough to restore public confidence unless taxpayers see tangible improvements in public services, infrastructure, healthcare, education and job creation.
Nyangweso said the government's ability to demonstrate efficient use of public funds would determine whether taxpayers embrace future tax reforms.
"There is a growing demand for expenditure efficiency. When citizens do not see value for every shilling collected, mistrust continues to grow," he said.
The concerns come at a time when the government is seeking to increase revenue collection while maintaining economic growth and easing pressure on a narrow pool of taxpayers who have historically carried most of the tax burden.
“What we would like to emphasise a lot is the aspect of accountability because the common Mwananchi on the ground does not have any problem with the Finance Act the way it is but we just want to see to it that the Finance Act or the budget is implemented to the latter and in a more accountable way,” said CEO of Eastleigh based CSO Denovop, David Odhiambo.
Kenya Revenue Authority representative from policy and tax advisory division Monica Lekake added that there should be a clear link between tax payment and public accountability.
“It is the obligations of government agencies who are responsible to ensure that the implementation of our taxes is properly done. Not just properly done, but seen to transform and change the lives of Kenya."
The NTA argues that widening the tax base is a more sustainable approach than repeatedly increasing taxes on salaried workers and compliant businesses.
But the association warned that stronger tax collection efforts must be accompanied by greater transparency and accountability across government institutions.
Tax lobby groups also pointed to concerns over public wastage and leakages, arguing that visible improvements in governance would help strengthen the social contract between taxpayers and the state.
The office of the controller of budget said that the past few years have seen an improvement in accountability but issues such channeling public funds to personal emoluments still remains a challenge.
Business groups have long argued that predictable tax policies and prudent use of public resources are critical for investment decisions, business expansion and economic growth.
The Finance Act is expected to play a key role in financing government programmes during the 2026/27 financial year, but analysts say its long-term success will ultimately be judged not by the amount of revenue collected but by whether taxpayers can see meaningful economic and social returns from their contributions.
The forum brought together policymakers, implementers, civil society organizations, tax experts, and accountability stakeholders to discuss the alignment of the Finance Act 2026-27 with the National Tax Policy and medium tax revenue strategy and explore the implications of recent tax measures on revenue mobilization, debt sustainability, fiscal performance and social equity.
