• The recently enacted Income Tax Act outlines explicit procedures for assessing and collecting Capital Gains Tax. It is meant to align Kenya’s tax system with established international standards.
  • The Special Economic Zones Act, as amended, expands the definition of eligible sectors.
  • The Technopolis Act, also signed into law, establishes and manages special technology and innovation zones in Kenya.

President Ruto stated these laws will strengthen Kenya’s businesses to attract investors on May 11, 2026. 

"We are streamlining our laws to strengthen Kenya’s position as an attractive investment destination by creating a more efficient, predictable, and competitive business environment," he shared on X.

Here are the amendments and their effects on the Kenyan business sector.

Income Tax Act

The recently enacted Income Tax Act outlines explicit procedures for assessing and collecting Capital Gains Tax. It is meant to align Kenya’s tax system with established international standards. It guarantees the rules remain transparent and reliable. The law also supports ongoing reforms to create simpler, more consistent processes for businesses. These will ease the mwananchi’s efforts in busy setups, increasing their chances of fair, affordable, and accessible biasness filed internationally.

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Special Economic Zones Act

The Special Economic Zones Act, as amended, expands the definition of eligible sectors. With zones to include the oil and gas industries. By establishing uniform tax incentives, the Act eliminates uncertainty and enhances the country’s ability to attract international investment. This directly empowers Kenyan businesses by reducing broker involvement and supplying clear operational guidelines, hence leading in cost savings.

Further, the law requires a minimum license tenure of 10 years for companies operating in special economic zones. This period accommodates capital investments with long timelines. It therefore ensures the legal framework aligns with the industry’s operating requirements. The mandated ten-year period permits organisations to grow and establish themselves more effectively under the law.

Technopolis Act

The Technopolis Act, also signed into law, establishes and manages special technology and innovation zones in Kenya. By establishing technopoles, the law facilitates technology-driven businesses. It also encourages research and centralises government support for enterprises in the sector. This comes at a timely moment, especially as artificial intelligence penetrates all business sectors.

President Ruto added that this system is expected to entice global investment, talent, and innovation, while accelerating Kenya’s transition into a knowledge-based digital economy.


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