‘That’s Not Over-Taxation!’ – CS John Mbadi Defends Ruto Policies
Treasury Cabinet Secretary John Mbadi detailed the workings of the Social Health Authority on Tuesday, dismissing claims that the government is overtaxing Kenyans.
Mbadi, who was present at the National Assembly’s mid-term retreat, presented a lengthy presentation on the health of the economy, outlining the tax consequences for a middle-income earner.
CS Hon. FCPA John Mbadi today made a presentation on the State of the Economy to Members of the National Assembly @NAssemblyKE during the 2025 Mid-Term Retreat at Lake Naivasha Resort, Nakuru County. Also present was PS for Economic Planning, Mr. James Muhati. @JBMuhati pic.twitter.com/MON5BDUIQg
— The National Treasury & Economic Planning (@KeTreasury) January 30, 2025
According to the CS, the implementation of the Housing Levy and Universal Health Care deductions was seen as excessive taxation, which was not the case.
Mbadi emphasized that a Kenyan with a KSh60,000 salary can only deduct KSh2550 from the housing levy and Social Health Authority deductions.
“If you are earning Ksh 60,000, the additional taxes you pay are the Housing Levy at 1.5 per cent and SHA at 2.75 per cent. Combined, this amounts to 4.25 percent, which is Ksh 2, 550,” Mbadi stated.
Mbadi stressed that without these two deductions, Kenyans would have continued to endure a 30 percent salary cut.
In the former defunct National Hospital Insurance Fund (NHIF), a Kenyan earning KSh 60000 would have received a KSh1,700 decrease in health insurance.
CS Mbadi believes it was a significant number when contrasted to the KSh1785 withdrawn from the same pay for both SHA and affordable housing.
“When you remove that from the Ksh 1,785, you are only paying Ksh 85 more. Is that over-taxation?” Mbadi challenged lawmakers.
Mbadi’s words came as Kenyans were growing concerned about the health of the economy and the increased deductions from their salaries.
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Kenyans were recently confronted with a new reality when the National Social Security Fund (NSSF) announced a 6% increase in employee contributions, which employers will match in equal quantities.
From February 1, minimum payments would increase from Sh420 to Sh480, while high-income workers will pay up to Sh4,320 from the previous Ksh2,160.
Lawmakers have expressed worries about the new healthcare system, prompting Deputy President Kithure Kindiki to promise a study of the Social Health Authority’s means-testing instrument.
The method is being reviewed to allow the onboarding of Kenyans at the bottom of the pyramid, such as mama mbogas and boda boda riders.
‘That’s Not Over-Taxation!’ – CS John Mbadi Defends Ruto Policies
