Treasury Cabinet Secretary John Mbadi has come out to correct widespread misinformation about the controversial Finance Bill 2025, assuring Kenyans that basic necessities remain untaxed.Speaking at a public forum, Mbadi addressed growing concerns while exposing how tax loopholes have been bleeding the economy dry.
No New Taxes on Essentials
Mbadi categorically denied social media claims that the bill introduces taxes on bread, milk, or unga. “There is nowhere in the Bill where we are taxing bread, milk or unga,” he stated emphatically during a public forum.
“They are not even mentioned. That is not my bill. It’s a propaganda bill manufactured by the opposition, and unfortunately, some people have believed it”
The CS challenged Kenyans to read the actual document, further dismissing viral claims about increased VAT or taxes on newborn care as pure fiction.
“I’ve heard people saying we will tax babies. That’s not true. You can read the real Finance Bill from page one to the last page. There’s nothing like that,” he said.
Cracking Down on Tax Fraud
The Treasury chief revealed shocking details about systemic abuse of zero-rated goods, explaining why items like e-bikes and mobile phones are being moved to exempt status.
“E-bikes and mobile phones are not being taxed. We’re just moving them from zero-rated to exempt because zero-rating is being abused,” Mbadi explained. “People make fake claims to KRA and take money that doesn’t belong to them.”
He revealed that some businesses work with corrupt KRA officials to fraudulently claim tax refunds, robbing the public of nearly 500 billion shillings.
“That money being stolen is your money,” Mbadi told citizens. “You wake up every day, work hard, pay taxes, then someone fakes a claim and walks away with it.”
Clarifying Existing Tax Measures
On the contentious issue of scrap metal taxation, Mbadi clarified: “There is no new tax on scrap dealers. The tax was already there, but we just clarified it.”
Mbadi said similar adjustments apply to suppliers working with public institutions, who will now clearly fall under withholding tax regulations.
The CS also addressed concerns about tax exemptions for vulnerable groups, affirming continued support for persons with disabilities and charities while emphasizing necessary safeguards.
“You have to apply through the right process,” he noted. “We approve many of these exemptions daily. But we can’t leave it open-ended because it will be abused.”
A Plea for Informed Debate
Frustrated by persistent misinformation, Mbadi made an impassioned appeal for citizens to engage with the actual bill rather than social media rumors. He recalled how similar misinformation surrounded last December’s tax amendments, which ultimately brought beneficial changes like tax-free retirement pensions.
“Even in December, when I brought the Tax Laws Amendment Bill to Parliament, there was a lot of propaganda. Yet today, people are thankful that retirement pension is no longer taxable,” he pointed out.
Acknowledging the economic pain that fueled youth protests, Mbadi admitted: “One reason Gen Zs went to the streets is because many are desperate. They finish school and can’t find jobs.”
He framed the Finance Bill as part of broader efforts to stimulate job creation, stating: “Our duty as the government is to create an environment where businesses can thrive and create employment.”
