The Treasury’s New Tax Frontier

Good evening. It’s Brian from The Kenyan Wall Street.

The Finance Bill is now a dominant topic in the news cycle as the budget reading nears. As the changes in the tax code are being debated, taxpayers will be looking for opportunities to ease their burden while the state deepens its claws on the revenue base to furnish its insatiable coffers.

Here are our day’s stories…

The Treasury’s New Tax Frontier

By Fred Obura

Kenya’s latest tax debate reveals a government trying to perform fiscal surgery without reopening the political wounds of 2024: widening the tax net while insisting it is merely simplifying the system. The Finance Bill 2026 recasts smartphones, cryptocurrency platforms, and even global payment giants like Visa Inc. and Mastercard not as symbols of innovation but as overlooked arteries of state revenue in an economy where digital commerce now moves faster than regulation. At the center of the controversy is a proposed restructuring of phone taxes that would collapse a maze of import duties and VAT charges into a single excise duty triggered only when a handset is activated, a technocratic adjustment that nonetheless lands in a country where the smartphone has become the nervous system of work, banking, and survival. The government is also edging deeper into the world of virtual assets, demanding reporting obligations from crypto operators while stopping short of a full crackdown, mirroring a broader global shift toward surveillance and formalization. Hovering over the entire debate is the memory of last year’s protests, giving even the most technical tax amendments the atmosphere of political explosives handled with rubber gloves.

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More Pressure on the State to Relieve Payroll Taxes

By Brian Nzomo

Kenya’s payroll tax system now appears like a stress test for the country’s shrinking middle class and not a revenue tool. In a rare alignment of accountants, bankers, auditors and increasingly sympathetic lawmakers, pressure is mounting on the Treasury to widen PAYE bands and ease deductions that critics say are punishing formal employment just as workers absorb higher SHIF, housing levy and NSSF contributions. The dispute exposes a deeper contradiction at the center of the Kenyan economy: the government needs predictable payroll taxes to service a debt load above KSh13 trillion, while businesses warn that collapsing disposable income is weakening consumption, savings and even the health of bank loan books. Hovering behind the technical language of tax bands and thresholds is a larger political question : how long salaried workers can remain the state’s most dependable source of revenue before the social and economic strain begins to show elsewhere.

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Overview of NSE Activities In Two Years

By Harry Njuguna

The Nairobi Securities Exchange (NSE) has recorded 10 new listings in the past 24 months across six asset classes, the most concentrated burst of capital market activity on the bourse since Safaricom's landmark initial public offering in 2008. The listings span corporate bonds, an infrastructure fund, two REITs, an equity IPO, a listing by introduction, an exchange-traded fund, an asset-backed security and Kenya's first Islamic Sukuk. Falling interest rates, government privatization and renewed investor appetite have converged to reshape Kenya's investment space, marking a broadening of the exchange offerings beyond the NSE's traditional equity and government securities base. Three more listings are already confirmed for the remainder of the year: the TRIFIC USD Green I-REIT, scheduled to list on 23 June, Family Bank by way of introduction, and the Park Inn Income REIT.

Read the full article here »»»»»

OPINION : Does Your Company Know Where It Stands on AI Governance?

By Simon Bransfield-Garth

Nairobi has become one of the world’s strangest laboratories for artificial intelligence: a place where boards still commission five-year AI strategies while junior staff quietly paste confidential briefs into chatbots before lunch. Kenya now ranks first globally in ChatGPT usage by internet-user share, creating a surreal corporate landscape in which executives insist AI has not yet arrived even as it has already seeped into HR systems, accounting software, meeting tools, and procurement platforms through invisible software updates and employee improvisation. The real anxiety is not technological but bureaucratic : African presidents signing declarations on ethical AI governance in Nairobi while many companies cannot fully account for where their own data travels, who trains on it, or what invisible systems already shape decisions inside the firm. What emerges is a portrait of managerial denial in the early AI age: the sense that the machines have entered the building quietly, through the side door, and long before leadership noticed.

Read the opinion piece here »»»»»

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What You Should Watch!

Everybody loves startup success stories. The funding announcements. The Forbes lists. The headlines. But very few people talk about what it actually takes to build a business in Africa. In this episode of the Just Money Podcast, Engineer, Entrepreneur, and Forbes Africa 30 Under 30 Honoree Ian Minjire breaks down the realities behind entrepreneurship, fundraising, governance, resilience, and survival in African markets.

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Probably Nothing, Circle’s becoming an “internet platform company”, and the youngsters are buying tokenised stocks

IN THIS ISSUE (02) 

• Circle’s becoming an “internet platform company”

• The young ones are buying tokenized stocks

• The S&P 500 is sucking up capital 

THE BIG READ 

Circle raises a bar, or two hundred

Circle, the issuer behind USDC, has raised $222 million in the presale of $ARC, the native token of its new blockchain that goes by the same name. Circle CEO Jeremy Allaire says the company's pushing to become an internet platform company, an operating system for businesses of sorts. The Arc network would effectively give Circle ownership over the distribution of USDC, its flagship product. Wall Street also came along, with Andreessen Horowitz investing $75 million, and BlackRock and Apollo Funds participating.

A few things to note here. The capital raise was through the sale of Arc tokens, and the new(ish) network is aimed mainly at institutional use. Circle is the first listed company to raise capital in this way. Allaire commented to CNBC, "It is a major shift in how stakeholders can participate in the growth of networks." And added, "Every company in the world, over time, will be tokenised, meaning your shares will be tokens."

Once you start plugging in other fiat-denominated stablecoins, things start to get really interesting. Through its built-in foreign exchange engine, you can initiate a payment in US dollars via USDC and have a supplier across the world receive it immediately in another local digital fiat, settling the transaction in under a second for a fraction of the cost of traditional payment rails.

"Blockchain infrastructure is becoming as important as mobile operating systems or cloud platforms. Circle is becoming a broader internet platform company. We're entering the operating system business and we're doing it by building this multi-stakeholder distributed model with a token, with a distributed network," Circle CEO Jeremy Allaire told CNBC.

Circle shares were up ~16% on Monday last week following the funding announcement alongside the company's first-quarter results. 

PICTURE THIS 

Almost half of tokenised stock investors on Luno are 34 and younger. These investors grew up with crypto, they're comfortable doing things differently, and tokenised stocks are just the next logical step for them. The more interesting question is what happens with the 35–44 crowd. They're likely earning more, have more to invest, and how the tokenised stock market will benefit from their sticking around. 

*Tokenised stocks are only available to investors in certain regions. 

QUICK TAKES 

US crypto legislation - The Senate Banking Committee advanced the Clarity Act on Thursday, moving the US closer to its first comprehensive crypto regulatory framework. The bill, which defines when digital assets are classified as securities or commodities, passed with all Republicans and two Democrats in favour, though both Democrats stopped short of committing to a floor vote. Banking groups are fighting stablecoin provisions they say create unfair deposit competition, while Senator Elizabeth Warren warned the bill puts consumers and financial stability at risk. With midterms potentially flipping the House, the industry knows this may be its best shot. - Reuters 

Inflation creep - April's Consumer Price Index came in at 3.8% last week, nudging above expectations and up from 3.3% in March, with energy prices accounting for 40% of the increase. The hotter-than-expected reading is unlikely to trigger an immediate Fed response, but it's shifting the conversation. Core inflation at 2.8% and services inflation at 3.3% give Fed hawks enough ammunition to push for a change in tone, with a 30% chance of a rate hike now priced in by December. - Yahoo! Finance

New Sheriff at the Fed - The Senate confirmed Kevin Warsh as Federal Reserve chair on Wednesday last week in a largely party-line vote, handing Trump his pick to lead the world's most powerful central bank. Warsh inherits a divided rate-setting committee, inflation running at 3.8%, well above the Fed's 2% target. Powell, meanwhile, isn't going anywhere, staying on the Fed board until January 2028, a potential competing power centre that possibly makes Warsh's job more complicated before he's even started. - PBS News

PROBABLY SOMETHING

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