Banks Contributed KES 194.81 Billion to Government in 2024
Banks Contributed KES 194.81 Billion to Government in 2024
Kenya’s banking sector contributed a total of KES 194.81 billion to the National Treasury for the year ending 31 December 2024.
This is according to the Total Tax Contribution of the Kenya Banking Sector – 2024 Report released by the Kenya Bankers Association (KBA) in partnership with PwC Kenya.
The report shows that the total tax contribution (TTC) from 36 participating banks and microfinance institutions accounted for 8.09 percent of all government tax receipts during the period.
This highlights the country’s continued reliance on a small group of highly compliant taxpayers.
Banks Contributed KES 194.81 Billion to Government in 2024
Shifting Tax Trends and Sector Performance
The KES 194.81 billion contribution included KES 100.12 billion in taxes borne, which are direct costs to banks such as corporate tax, and KES 94.69 billion in taxes collected on behalf of the government, including Pay As You Earn (PAYE) and Withholding Tax.
Corporate Tax remained the largest component at KES 69.41 billion, representing 35.63 percent of the total contribution, although it fell by nearly 5 percent compared to 2023.
The decline was balanced by a significant increase in people-related taxes. The Affordable Housing Levy, implemented for a full year, saw collections from the sector more than double, rising by 113 percent to KES 3.45 billion.
For every KES 100 of profit made by participating banks, KES 38.50 went to the government as taxes, a measure known as the Total Tax Rate. This was a decrease from 46.77 percent in 2023, largely due to improved profitability in the sector.
According to KBA Chief Executive Officer Raimond Molenje, the KES 194.81 billion contribution underscores the central role of the banking sector in Kenya’s revenue mobilization. He noted that the data provides useful insights for policymakers working to balance fiscal sustainability with sector resilience.
PwC Country and Regional Senior Partner for Eastern Africa, Peter Ngahu, added that the figures highlight the continued reliance on a few highly compliant taxpayers.
He emphasized that the findings should inform ongoing dialogue around tax policy to ensure the sector’s stability and long-term growth.
Supporting Growth Through Efficiency and Inclusion
The report also explored how banks distribute value among key stakeholders. The government received the largest portion at 54.95 percent through taxes, followed by employees at 25.62 percent through salaries and benefits, and shareholders at 19.44 percent through dividends.
Despite the strong performance, banks continue to face administrative costs related to tax compliance. On average, each bank employs three full-time staff dedicated to tax-related work, costing about KES 13.5 million annually.
Participants suggested reducing this burden by returning to monthly Withholding Tax filings and increasing automation through systems such as iTax and eTIMS.
The findings reaffirm the sector’s crucial role in Kenya’s economy. With consistent investment, transparent governance, and improved efficiency, the banking industry remains a vital contributor to national revenue and economic resilience.
