Treasury Cabinet Secretary John Mbadi on Thursday presented a KSh4.8 trillion budget to Parliament for the 2026/27 financial year.
The spending plan, the largest in Kenya’s history, is slightly higher than earlier projections and underscores President William Ruto’s administration’s focus on job creation, agricultural value-chain development at the grassroots, and expanded investment in social programmes and infrastructure.
Ahead of the budget presentation, Treasury officials maintained that the proposals are designed to boost local manufacturing and strengthen support for small and medium-sized enterprises, even as the government grapples with increasing pressure on public finances.
The budget framework is anchored on an ambitious domestic revenue target of KSh3 trillion. However, it still leaves a financing gap of more than KSh1.1 trillion, which the government intends to largely finance through borrowing from the domestic market.
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6.00 PM: Mbadi Proposes Changes To Deadline for Kenyans To File Tax Returns
Treasury Cabinet Secretary John Mbadi has proposed changes to Kenya's tax return filing framework, arguing that the current filing deadline does not give tax authorities sufficient time to review submissions before the beginning of the next financial year.
Explaining the rationale behind the proposal, Mbadi told Parliament: “Currently, the deadline for filing tax returns is 30th June of every year, which leaves no room for verification and validation of filed returns before the commencement of another financial year.”
Under the proposed changes, taxpayers who file nil returns would be required to submit them within one month after the end of the income year. Individuals whose earnings are fully taxed at source would have up to four months to file their returns. Meanwhile, all other taxpayers, including companies and businesses, would continue to be required to file their annual tax returns by June 30.
5.48 PM: Govt Allocates Ksh46 Billion To sports & Tourism
Treasury Cabinet Secretary John Mbadi has proposed an allocation of KSh45.6 billion to the sports and tourism sector in the 2026/27 financial year.
The proposed funding includes KSh25.2 billion for the Sports, Arts and Social Development Fund and KSh14.3 billion for the Tourism Fund. The allocation is expected to support sports development, talent nurturing, arts and cultural programmes, as well as tourism promotion initiatives aimed at boosting visitor numbers, creating jobs, and strengthening the sector's contribution to the economy.
5.37 PM: MPs To Get Ksh61 Billion To Support Their Constituencies
Treasury Cabinet Secretary John Mbadi has proposed an allocation of KSh61.8 billion to the National Government Constituencies Development Fund (NG-CDF) in the 2026/27 financial year.
The funding is intended to support grassroots development projects across the country's constituencies, including the construction and rehabilitation of schools, bursary programmes, security initiatives, and other community-based infrastructure projects. According to the budget proposals, the allocation is aimed at strengthening service delivery at the local level and accelerating development in areas that require targeted government support
5.26 PM: Education Gets Massive Ksh785 Billion
Education has emerged as the biggest beneficiary in the proposed 2026/27 national budget, with Treasury Cabinet Secretary John Mbadi proposing an allocation of KSh784.5 billion to the sector.
Presenting the budget in Parliament, Mbadi said the allocation represents 26.4 per cent of the total ministerial budget, underlining the government's continued commitment to improving access to quality education at all levels.
The funding is expected to support key programmes including free primary and secondary education, university and TVET financing, school infrastructure development, teacher recruitment, and the implementation of ongoing education reforms. The sizeable allocation reflects the central role education plays in the government's strategy to develop human capital, create opportunities for young people, and drive long-term economic growth.
5.12 PM: Govt Announces Fresh Crackdown On State Agencies
Treasury CS John Mbadi has announced that no additional exemptions will be granted to public institutions that have yet to migrate to the Electronic Government Procurement (e-GP) system from July 2026.
The directive signals a major push by the National Treasury to fully digitise public procurement and strengthen transparency, accountability, and efficiency in the use of public funds. All procuring entities will now be required to conduct their procurement processes through the online platform.
Since its rollout in July 2025, the e-GP system has onboarded 1,543 procuring entities, trained more than 22,000 government staff, and facilitated the publication of over 8,000 tenders. The platform has also attracted thousands of suppliers, marking a significant shift towards paperless and more transparent procurement across government institutions.
5.05 PM: Govt Hands Relief For Banks
Commercial banks could receive additional time to comply with stricter capital requirements after the National Treasury proposed extending the deadline for lenders to increase their core capital from Ksh1 billion to Ksh10 billion.
In his budget statement, Treasury Cabinet Secretary John Mbadi said the government intends to move the compliance deadline from 2029 to December 2032. The proposal would also eliminate the annual capital growth targets that had been introduced to guide banks toward meeting the requirement.
The move is expected to ease pressure on smaller and mid-sized lenders that have faced challenges raising additional capital within the original timeframe. If approved, the extension would give banks more flexibility to strengthen their balance sheets while continuing to support lending and broader economic growth.
4.39 PM: Kenya Cleared To Host Climate Fund Office: CS Mbadi
CS John Mbadi announced that Kenya has been awarded the right to host the Green Climate Fund Regional Office for East and Southern Africa in Nairobi, a development he said strengthens the country's standing as a key centre for climate financing on the continent.
Mbadi noted that the government will also host the African Green Investment Forum in October 2026. According to the CS, the forum "will serve as a flagship continental initiative designed to mobilize green finance, accelerate sustainable investment, and advance Africa’s leadership in this domain."
4.08 PM: Mbadi Dims Hopes For Kenya's Economy In 2026
Treasury Cabinet Secretary John Mbadi told Parliament that Kenya's economic growth forecast for 2026 has been lowered due to global uncertainties linked to tensions in the Middle East.
"The outlook for 2026 has been revised downwards, however, to 5% from the earlier projection of 5.3%, reflecting the adverse impact of the ongoing conflict in the Middle East on domestic economic activities," Mbadi stated.
Despite the adjustment, the CS expressed optimism about the country's economic prospects, noting that growth is expected to remain strong and "maintain the momentum in 2027 with a projected growth rate of 5.2%."
4.05 PM: Activist Julius Kamau Arrested
Activist Julius Kamau has been arrested by plainclothes police officers in Nairobi's Central Business District (CBD) as Treasury Cabinet Secretary John Mbadi presented the 2026/27 Budget Statement in Parliament.
3.51 PM: CS Mbadi Gives Update On Ruto's Affordable Housing Projects
Treasury Cabinet Secretary John Mbadi has announced that more than 277,000 affordable housing units have been completed across the country under the government's housing programme.
Speaking during the budget presentation, Mbadi said the initiative continues to attract significant public interest, with over one million Kenyans having registered on the Boma Yangu platform in pursuit of home ownership opportunities.
He noted that the programme is aimed at increasing access to decent and affordable housing while also creating jobs in the construction sector and related industries. The growing number of registrations, he said, reflects strong demand for affordable homes among Kenyans seeking to transition from renting to owning property and build long-term financial security.
3.39 PM: Mbadi Explains Why Kenyans Want Lower Taxes
Treasury Cabinet Secretary John Mbadi told Parliament that many Kenyans are calling for relief from the high cost of living through lower taxes on basic commodities, prudent use of public resources, and tougher measures to combat corruption.
According to Mbadi, public feedback gathered by the government showed that citizens want greater accountability in the management of public funds, arguing that reducing wastage and sealing corruption loopholes would free up resources for essential services and ease economic pressure on households.
The CS also assured lawmakers that Kenya has strengthened its preparedness against a possible Ebola outbreak. He noted that health authorities have intensified screening and surveillance measures at key entry points, trained more than 1,000 healthcare workers on outbreak response, and maintained rapid response teams on standby to ensure the country can quickly contain any suspected cases.
3.14 PM: Mbadi Leads MPs In Minute Of Silence Over Raila's Death
Before delivering the 2026/27 Budget Statement, Treasury Cabinet Secretary John Mbadi called on lawmakers to observe a moment of silence in honour of the late former Prime Minister Raila Odinga.
Addressing the House, Mbadi said: "This is the first budget since the passing of the late Raila Odinga, who is fondly remembered as a patriot and national hero and who championed economic justice, democracy, and equal opportunity for all Kenyans. In honour of his immense contribution to our country, I would politely request and invite members of this house to observe a moment of silence."
Members of Parliament stood in silence as requested, with some legislators later chanting "Jowi", a popular nickname associated with Odinga.
Following the tribute, Mbadi proceeded with the presentation of his budget speech.
3.03 PM: Wetang'ula Explains Ruto's Absence During Budget Reading
National Assembly Speaker Moses Wetang’ula has clarified why President William Ruto was not present in Parliament during the presentation of the 2026/27 Budget Statement, maintaining that the Head of State is not required by law to attend the session.
Addressing the House, Wetang’ula stated: “For the avoidance of doubt, the President of the country is under no obligation to attend Parliament on the day when the Cabinet Secretary for Treasury comes not to read a budget but to make a statement and give to the country his revenue measures.”
He further noted that while the President is free to attend if he wishes, protocol dictates that he would not preside over the sitting.
“Indeed, if the president chose to come, which he can, he would sit in the Speaker’s row. He will not sit where I am sitting; where he sits when he comes to address the House,” Wetang’ula added.
President Ruto is currently away on an official tour of Europe.
Several Cabinet Secretaries attended the budget presentation, among them Alice Wahome (Lands), Aden Duale (Health), Kipchumba Murkomen (Interior), Soipan Tuya (Defence), Geoffrey Ruku (Public Service), Julius Ogamba (Education), Mutahi Kagwe (Agriculture), Salim Mvurya (Sports), Beatrice Askul Moe (EAC and Regional Development) and Opiyo Wandayi (Energy).
