The International Monetary Fund told the Ruto administration that raising tax rates would not be the most effective way to increase revenue, urging instead a widening of Kenya’s tax net.

IMF Communications Director Julie Kozack called for reduced tax exemptions and tighter compliance as the preferred route to domestic revenue growth.

Kozack framed the advice as part of a “credible, balanced, and equitable” consolidation strategy that also calls for greater fiscal transparency and targeted social protection for vulnerable households.

Kenya’s tax‑to‑GDP ratio currently sits around 14‑15%, well below the government’s 20‑22% target and the African average, underscoring the need to broaden the base.

The advice follows political unrest after mass protests in June 2024 forced President Ruto to abandon a Finance Bill that proposed tax hikes, and arrives as inflation rose to 7.3% in October 2026.

The Kenya Revenue Authority has already introduced digital compliance tools, such as a WhatsApp chatbot launched in April 2026, to widen compliance without new legislation.

IMF officials plan to travel to Nairobi in early December to discuss a possible new financial programme after the previous KSh 465.5 billion programme expired in April 2025 without its final tranche.