World Bank Proposes Restructure of PAYE for Kenyans With Housing Levy Relief

Kenyans earning less could end up paying lower income taxes, Pay As You Earn (PAYE), if the government adopts proposals from the World Bank.

The global multilateral lender has proposed changes to Kenya's Personal Income Tax (PIT), which the bank assures will increase tax progressivity while keeping revenue neutral.  In the changes, the World Bank has proposed an increase to tax bands, income brackets used to determine how much PAYE an individual is required to pay, noting that the current PIT model disproportionately affects low-wage earners and does not rise significantly for higher earners when accounting for contributions.

For Kenyans earning up to Ksh288,000 per annum (Ksh24,000 per month), PIT was set at ten per cent.

This was in line with the previous model, thus representing no change.  A graphic showing taxes and the Kenyan flag in the background.