Former ICT Cabinet Secretary Eliud Owalo has vowed to overhaul Kenya’s taxation system, promising significant reductions in income tax and VAT if elected president in 2027.

Speaking on a local media station on Sunday, February 2, 2026, Owalo said the current tax regime is punitive to both businesses and individual taxpayers, adding that high taxes are pushing many Kenyans below the poverty line.

“One, I’ll sort out the punitive taxation regime. We have got a tax system that is not enabling to the business community, that is punitive to individual taxpayers,” Owalo said.

Immediate reforms

Owalo outlined immediate measures he would implement, including cutting the income tax rate from 35% to 20% and reducing VAT from 16% to 10%.

He also pledged to abolish the digital tax and rationalise corporate tax to a predictable 5%, ensuring stability for at least five years.

“Immediately I get into office, I will bring down income tax from 35% to 20%. I will bring down VAT from 16% to 10%. I will do away with digital tax. Corporate tax will be predictable, rationalised at about 5% and stable for five years,” he said.

Revenue plan

Addressing concerns about how the government would raise revenue with lower taxes, Owalo said the solution lies in sealing revenue leakages and tackling corruption.

He also plans to expand the tax base by putting more disposable income in the hands of youth, women, and the informal sector, effectively bringing more people into the tax net.

“Out of a possible 35 million Kenyans who can pay tax, only nine million are currently eligible. By re-engineering value chains at the grassroots, we can bring more people into the income bracket while still collecting enough revenue to finance government operations and development,” he said.

Owalo argued that the current taxation system is unsustainable, leaving Kenyans frustrated and struggling to survive. He noted that about 40% of Kenyans live below the poverty line due to high taxes and rising national debt.

“You cannot put taxes at this level and let Kenyans live a decent life. As we speak today, 40% of Kenyans are living below the poverty line because of an unpalatable tax regime, high levels of taxation, and spiralling debt,” he said.