Kenya Banks' Tax Hit: Sh194.81B in 2024

Kenya, 25 October 2025 - Kenya’s banking sector delivered a total tax contribution of Sh194.81 billion to the National Treasury in 2024, demonstrating its continued financial strength and central role in government revenue mobilization.

This significant contribution, drawn from 36 participating banks and microfinance institutions, represents 8.09 per cent of the total government revenue for the year. The total figure marks a slight increase of just over 2 per cent compared to 2023, reflecting the sector’s steady recovery and strong financial performance.

The tax contribution, detailed in the latest Kenya Bankers Association (KBA) report, comprised Sh100.12 billion in Direct Taxes (paid by banks) and Sh94.69 billion in Indirect Taxes (collected on behalf of the government).

However, a key highlight was identified: While Corporate Tax remained the largest single component at Sh69.41 billion, it saw a nearly 5 per cent decline. This drop was largely mitigated by a steep increase in people-related taxes. The collections from the Affordable Housing Levy (AHL), for instance, more than doubled to Sh3.45 billion, marking a staggering 113 per cent surge due to its full-year implementation.

The sector's heavy fiscal responsibility is starkly evident in its Total Tax Rate (TTR): for every Sh100 in profit, banks paid Sh38.50 to the government.

In addition, employee-related taxes surged, driven by highly skilled salaries and legislative changes. PAYE collections rose to Sh31.77 billion, accounting for over 91 per cent of staff-related taxes, a trend accelerated by the July 2023 revision of the top PAYE rate to 35 per cent.