Capital markets stakeholders push for tax reforms in Finance Bill 2026

APTAK president Hosea Kili, NSE Head of Trading David Wainaina and Willy Njoroge from Association of Brokers during the stakeholders engagement on the Finance Bill, 2026 at Glee Hotel, Kiambu Road, on May 25, 2026. [Elvis Ogina, Standard]

Kenya’s capital markets stakeholders have called for changes to stamp duty on share transactions under the Finance Bill 2026, saying the current flat fee system unfairly burdens small investors at the Nairobi Securities Exchange (NSE). 

They want stamp duty shifted to a percentage-based charge of 0.02 per cent, arguing that retail investors trading small amounts end up paying the same levy as large institutional investors, discouraging broader participation in the market.

Speaking during the Finance Bill 2026 public participation hearings, NSE Head of Trading David Wainaina, said the proposal is aimed at improving fairness and widening access to the market.

Beyond the stamp duty proposal, stakeholders are also pushing for tax incentives to attract more companies to list on the stock exchange. 

They have proposed cutting corporate income tax for newly listed firms from 30 per cent to 15 per cent, saying this would encourage initial public offerings and improve market depth.

Wainaina also called for tax exemptions on infrastructure bonds to be extended to cover privately issued infrastructure-related corporate bonds. 

The stakeholders argue that equal tax treatment would allow pension funds and institutional investors to channel more capital into infrastructure projects beyond government issuance.

They called for simplified tax procedures for non-resident investors opening accounts through banks and investment firms, saying the current system creates unnecessary administrative friction despite taxes already being collected at source.

Pension sector representatives separately proposed tax exemptions for trust funds established to support dependents of deceased pension members. 

Dr Hosea Kili, the president of the Association of Pension Trustees and Administrators of Kenya said the funds are essential for covering education and living expenses for widows and children and should not face additional taxation after retirement benefits have already been taxed. 

Kili noted that such trusts typically run for 10 to 25 years, depending on beneficiaries’ needs.

Stakeholders also raised concerns about limited availability of Sharia-compliant investment products, calling for broader support to meet growing demand for Islamic finance instruments in the market.