Speaking during the official opening of the Kenya Comprehensive School Heads Association (KECSHA) meeting in Mombasa on Thursday, November 12, 2026, the Head of State defended the housing levy while outlining how the planned tax adjustments could benefit employees.
Ruto revealed that his administration intends to increase the monthly income exempted from PAYE tax from the current Ksh24,000 to Ksh32,000.
Under the proposed changes, workers would pay no PAYE tax on the first Ksh32,000 of their monthly taxable income. The president argued that the adjustment would provide greater financial relief than the amount employees contribute towards the housing levy.
To explain how the proposal would work, Ruto used the example of a teacher earning Ksh50,000 per month.
According to his calculations, such a teacher would save approximately Ksh2,000 through the proposed PAYE reduction. Meanwhile, the employee would contribute Ksh750 towards the Affordable Housing Levy, leaving them with an estimated additional Ksh1,250 every month.
"My competitors are sponsoring a debate saying they want to protect the payslip. We are proposing that we want to remove PAYE on the first Ksh32,000 on what you earn," Ruto stated.
The president maintained that the proposed adjustment would allow workers to retain more of their salaries instead of focusing only on the deductions appearing on their payslips.
The wider tax proposal also seeks to raise the monthly tax-free income threshold to Ksh32,333 while removing the existing Ksh2,400 personal relief. The 1.5 per cent Affordable Housing Levy would, however, remain in place.
Ruto also used the occasion to defend the government's Affordable Housing Programme, arguing that the initiative had created employment opportunities for thousands of Kenyans.
He disclosed that approximately 1.1 million people were working under projects associated with the programme, which include residential houses, markets and student accommodation facilities.
Additionally, the president revealed that contracts for housing projects, markets and student hostels had reached Ksh1.2 trillion.
He added that construction was underway on accommodation facilities expected to provide space for more than 180,000 learners across the country.
The proposed PAYE adjustments are expected to attract attention from teachers and other salaried workers, particularly those interested in knowing how much of their monthly income they could retain if the changes are implemented.
Source:https://www.facebook.com/100064288795404/posts/1578806950938916/?app=fbl
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