Nairobi County Revenue Bill Advances Through Assembly: What Changes for Residents' Tax Bills

The Nairobi County Revenue (Amendment) Bill 2026 moved to the full assembly floor on Wednesday after the Finance and Budget Committee approved it with amendments. The legislation, introduced in March, would broaden the tax base on residential and commercial properties and adjust valuation methods used to calculate rates since 2015. For the roughly 1.2 million property holders in Nairobi County, the bill marks the first major overhaul of local tax assessment in more than a decade.

County officials say the changes are necessary to plug gaps in the municipal budget. Nairobi's 2025-26 budget shows property tax revenue fell short by 3.2 billion shillings against projections, according to county treasury documents reviewed this week. The shortfall has delayed maintenance on secondary roads, reduced frequency of refuse collection in some estates, and slowed infrastructure projects in informal settlements. The new bill aims to close that gap by requiring annual property revaluations and lowering exemptions for certain commercial buildings currently classified as residential.

What This Means for Homeowners and Tenants

Residents in estates like Westlands, Kilimani, and Karen-where property values have climbed significantly since 2015-could see rate increases of 15 to 40 percent if assessments reflect current market prices, policy analysts tracking the bill estimate. A middle-income home valued at 15 million shillings in Nairobi might move from the current 8,000 shilling annual bill to between 9,200 and 11,200 shillings. Apartment renters would likely see those costs passed on through higher rent, though no direct tax obligation falls on tenants.

The bill includes new provisions on commercial spaces. Mixed-use buildings-where ground floors operate as shops or offices and upper floors are residential-would no longer qualify for residential tax rates on the entire structure. The change affects property owners in high street areas like Ngong Road and parts of Nairobi West where such mixed-use construction has expanded. Committee notes indicate the change could affect an estimated 8,400 such properties in the county, though final numbers await full valuation.

Exemptions for places of worship, charitable organizations, and public institutions remain intact under the amended version. Schools and hospitals continue to pay nominal rates. The bill does add a new hardship clause allowing residents to appeal valuations if they can demonstrate financial difficulty, though the process and decision timeline remain undefined in the current draft.

Timeline and What Residents Should Watch

The assembly is expected to vote on the bill in late July. If passed, implementation would begin in the 2026-27 financial year starting July 1, 2026. County officials say property revaluation-the technical step that determines actual tax amounts-would take 90 to 120 days after passage, meaning most residents would receive new bills by October or November. The county plans to phase in increases over two years rather than impose them all at once, though the specific phase-in percentages have not been finalized.

Property owners can track the bill's progress through the Nairobi County Assembly website and submit written views to the Finance and Budget Committee during this final stage. Residents have historically used the public comment period to challenge valuations and request exemptions or deferrals. Last week, a coalition of informal settlement residents' groups submitted a memorandum requesting that properties in areas without piped water or sewerage receive tax reductions, a position the committee acknowledged but did not formally adopt.