Treasury Cabinet Secretary John Mbadi has announced a six-month tax amnesty for taxpayers with outstanding tax arrears, allowing them to clear their principal tax without paying accumulated penalties and interest.

Speaking in an interview with a local TV station on Wednesday, July 1, 2026, as he outlined the key provisions of the Finance Act, 2026, which came into effect on July 1, Mbadi said the measure is intended to give taxpayers who have struggled to meet their tax obligations an opportunity to regularise their tax affairs.

He noted that many Kenyans have been unable to pay their taxes on time due to various challenges, resulting in the accumulation of penalties and interest over the years.

“For various reasons, there are some Kenyans, taxpayers, who have not been able to pay their taxes on time. And so, they have been penalised, interests have been charged, and penalties have been levied,” Mbadi said.

Mbadi explains the amnesty programme

Under the new tax amnesty programme, taxpayers with outstanding tax arrears accumulated up to December 2025 will have a six-month window, beginning July 1 and ending on December 31, 2026, to settle only the principal tax owed.

“This Act allows those who have tax arrears up to 2025. We are giving them a tax amnesty of six months, beginning today, up to December 31, 2026. During which time you’ll be required to only pay the principal tax,” Mbadi added.

He urged eligible taxpayers to take advantage of the amnesty by presenting themselves to the Kenya Revenue Authority (KRA) and clearing their principal tax within the stipulated period.

“So you just present yourself to the tax authority and pay the principal tax, and all the interest and all the penalties will be waived,” he added.

The tax amnesty is among several relief measures introduced under the Finance Act, 2026, aimed at easing the tax burden on Kenyans, improving voluntary tax compliance and enhancing revenue collection without imposing additional financial pressure on taxpayers.