Treasury Cabinet Secretary John Mbadi has moved to clarify concerns surrounding proposed tax measures on digital money transfer services.

Speaking during a press conference on Monday, May 25, 2026, where he responded to public concerns over the Finance Bill 2026, Mbadi insisted that mobile money platform Safaricom M-Pesa is not among the services being targeted.

He explained that the proposed changes are aimed at addressing the Value Added Tax (VAT) treatment of emerging digital financial intermediaries rather than traditional financial services.

Clarification on digital transfer taxation

According to the Treasury CS, the VAT Act currently exempts a number of financial services but does not adequately address modern technology-based payment intermediaries.

Mbadi said the proposal specifically targets ICT-driven digital services that facilitate financial transactions through technological platforms.

“Whereas the VAT Act expressly exempts listed financial services, it does not address the VAT treatment of modern digital intermediaries such as Payment Service Providers and other technology-based platforms that facilitate money transfer and financial transactions,” Mbadi said.

Traditional financial services remain exempt

The CS clarified that traditional banking and financial services such as cash deposits, withdrawals, and foreign exchange transactions would remain unaffected under the proposed framework.

He stressed that the focus is on digital intermediary services operating outside the traditional financial services structure.

“Specifically targeted are the digital services that are ICT-driven as opposed to the traditional financial services such as cash deposits, withdrawals, forex exchange and related services,” Mbadi explained.

Safaricom not among targeted firms

Addressing growing public speculation over M-Pesa charges, Mbadi revealed that the government had already held discussions with Safaricom to clarify the matter.

“It is worth noting that we had a meeting with Safaricom on Friday last week and explained that they are not amongst those we are targeting,” he stated.

The clarification comes amid growing anxiety among Kenyans over potential increases in transaction costs through mobile money platforms, which remain widely used across the country.

The Finance Bill 2026 has triggered intense political and public debate, with opposition leaders and sections of the public raising concerns over what they describe as possible hidden tax measures.

Government officials, however, have maintained that several claims circulating online are misleading and politically motivated.

Mbadi has repeatedly defended the Bill, urging critics to point out specific clauses they consider punitive instead of spreading misinformation.

The proposed legislation is currently undergoing public scrutiny before debate in Parliament.