NAIROBI, Kenya — President William Ruto has signed into law three major Bills aimed at reforming Kenya’s tax framework, attracting investment and accelerating the country’s ambitions of becoming a regional technology and innovation hub.
The President assented to the Income Tax (Amendments) Bill, 2026, the Special Economic Zones (Amendments) Bill, 2026 and the Technopolis Bill, 2024 during a ceremony at State House Nairobi on Monday.
Senior government officials present during the signing included Deputy President Kithure Kindiki, ICT Cabinet Secretary William Kabogo, Attorney General Dorcas Oduor, National Assembly Speaker Moses Wetang’ula, Majority Leader Kimani Ichung’wah and Minority Leader Junet Mohamed.
The latest assent marked the seventh presidential signing ceremony of 2026 and reflects the government’s broader push to implement reforms targeting industrialisation, digital transformation and economic growth.
Speaking during the event, Deputy Chief of Staff Josphat Nanok said the tax reforms are intended to modernise Kenya’s investment environment and simplify corporate transactions.
“The amendments are intended to create a more efficient and predictable tax environment while supporting business restructuring and investment growth,” Nanok said.
Tax reforms target corporate restructuring
Under the newly signed Income Tax amendments, transfers of property between companies and shareholders during internal restructuring will be exempt from capital gains tax, provided ownership proportions remain unchanged.
The government argues the reforms will reduce compliance burdens and make it easier for businesses to reorganise operations without triggering additional tax liabilities.
Treasury officials have in recent months signalled broader plans to review Kenya’s tax system amid growing pressure from businesses over high operating costs and concerns about investor confidence.
The reforms are expected to take effect in the 2026/27 financial year beginning July 1, 2026.
The changes also come amid ongoing policy discussions over Pay As You Earn (PAYE) reforms and possible tax relief measures targeting low-income earners as the government seeks to widen the tax base while cushioning households from economic pressure.
Special Economic Zones receive fresh incentives
At the same ceremony, Ruto signed amendments to Kenya’s Special Economic Zones framework aimed at attracting long-term industrial and energy investments.
The revised law incorporates upstream and midstream petroleum operations into Special Economic Zones and introduces a guaranteed 10-year tax incentive regime for developers, operators and licensed enterprises.
The legislation further provides VAT zero-rating for certain supplies within Special Economic Zones and removes the earlier 10-year cap on withholding tax exemptions covering royalties and management fees.
Analysts say the changes are designed to strengthen Kenya’s competitiveness against regional investment destinations such as Rwanda, Ethiopia and Tanzania, which have increasingly offered aggressive tax incentives to attract manufacturers and technology firms.
Kenya currently hosts several Special Economic Zones, including facilities in Mombasa, Naivasha and Kisumu, which the government hopes will become export-oriented industrial hubs.
Technopolis law targets Kenya’s digital economy ambitions
Ruto also signed the Technopolis Bill into law, establishing a legal framework for the development and governance of technology-driven urban innovation zones under Kenya’s Vision 2030 strategy.
The law creates the Technopolis Development Authority and outlines governance structures, licensing procedures and compliance mechanisms for managing future innovation cities and technology clusters.
It also formally repeals the earlier Konza Technopolis Development Authority order and transitions oversight into the new legal structure.
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The move is expected to strengthen Kenya’s efforts to position itself as East Africa’s leading digital economy and attract global technology companies, research institutions and innovation-focused investors.
The government has increasingly prioritised digital infrastructure, ICT investment and artificial intelligence policy frameworks as part of its long-term economic transformation agenda.
Industry analysts say the success of the new reforms will depend on regulatory consistency, infrastructure expansion, investor confidence and the government’s ability to maintain macroeconomic stability amid rising public debt and global economic uncertainty.
