Mbadi denies reports of VAT on bread and milk in Finance Bill 2025
Treasury Cabinet Secretary John Mbadi has dismissed widespread claims circulating on social media that the Finance Bill 2025 seeks to impose Value Added Tax (VAT) on essential food items such as bread, milk, and maize flour (unga), calling the reports “propaganda” and factually inaccurate.
Speaking on a local media station on Monday, June 9, 2025, Mbadi asserted that none of the essential commodities being mentioned were listed for taxation in the bill currently before the National Assembly.
“Unfortunately, you are addressing a propaganda finance bill, not the one that is in the National Assembly,” Mbadi noted
“There is nowhere in that bill — and I can take a bullet for it — where we are putting VAT on bread. We have not even touched bread. Milk is not even mentioned. Unga is not even mentioned,” he added.
He insisted that the version being circulated online was a fabrication, which he accused the opposition of manufacturing to mislead the public.
“That bill being talked about on social media is not my bill. It’s a bill manufactured by the opposition, and you seem to have bought it,” he stated.
VAT increase
Mbadi also dispelled rumours that the government intended to increase VAT from the current 16 per cent to 18 per cent.
“There is no time that the government of Kenya has thought of increasing VAT from 16% to 18%. So I want to just give you assurance,” he said.
The Cabinet Secretary further dismissed claims that the bill proposes to tax neonatal care services.
“No one is going to be subject to tax on neonatal care. I heard that we are going to tax newborn babies. That’s a propaganda bill,” he said.
“The actual bill which I carry here today, you can read it from page one to the last page. There is nothing like that,” he clarified.
Countering misinformation
Mbadi pleaded with critics to base their objections on facts rather than misinformation.
“I want to just plead with you, and that is why sometimes I ask myself, we are all Kenyans. This country belongs to us. Even if we want to make the government look bad, let us have facts. Let us not peddle propaganda just to create distortion,” he said.
He cited the Tax Laws Amendment Bill of December 2024 as an example of how misinformation had previously surrounded progressive legislation.
He noted that the bill, which made pension income tax-free upon retirement, had initially faced similar propaganda campaigns.
“In December 2024, when I brought the tax laws amendment bill to Parliament, there was a lot of propaganda, fake things that were not in the bill. And it is a bill that was progressive, which has helped now, and people are appreciating and they are thanking us, that now if you retire, your pension is not taxable,” he stated.
“That would have been lost if you listened to propaganda.”
Economic concerns
Addressing broader economic concerns, Mbadi acknowledged the frustrations that led to the Gen Z demonstrations against the Finance Bill 2024, particularly regarding youth unemployment.
“One of the reasons why we had the demonstrations and the uprising of Gen Z was because many of them were desperate. These children are coming out of school without jobs. And yet, you are told that you go to school to break away from the cycle of poverty,” he explained.
The Treasury CS emphasised the government’s role in creating an enabling environment for economic growth and job creation.
“The role of government is to make sure that we create an enabling environment for businesses to thrive, for investment to thrive, to expand job opportunities, to create job opportunities for our people,” he added.
