Kenya faces a well-documented fiscal challenge: a structural revenue gap that limits government's ability to fund development priorities without unsustainable borrowing. This working paper argues that the conventional framing of the problem — as a tax rate question — is both analytically incomplete and strategically misleading. Kenya's revenue challenge is primarily a base breadth problem, not a rate level problem.
The analysis draws on revenue administration data from the Kenya Revenue Authority, county revenue records from the Controller of Budget, and comparative evidence from eight Sub-Saharan African economies that have successfully broadened their tax bases in comparable institutional contexts. The evidence consistently supports a revenue reform strategy organised around three pillars: informal sector formalisation and simplified taxation, property tax modernisation, and environmental and resource-based levies.
Each pillar is analysed for its revenue yield potential, implementation feasibility within Kenya's existing institutional framework, distributional implications, and political economy of reform. The paper concludes with a sequenced implementation roadmap calibrated to KRA's current digital transformation trajectory and the Kenya Kwanza government's fiscal consolidation commitments.