Nairobi Governor Johnson Sakaja has announced a 100 percent waiver on penalties and interest accrued on land rates, provided the principal amount is paid in full between December 15 and December 31, 2025.
The directive, published in a special issue of the Kenya Gazette dated December 16, 2025, under Gazette Notice No. 18368, is anchored in the Nairobi City County Tax Waivers Administration Act, 2013, and the Public Finance Management Act, 2012.
According to the notice, the waiver period runs from December 15 to December 31, 2025.
“In exercise of the powers conferred by section 5 (2) (a) of the Nairobi City County Tax Waivers Administration Act, 2013, the County Executive Committee Member for Finance and Economic Planning in concurrence with the Governor, Nairobi City County, grants 100% waiver of penalties and interest on land rates if the principal is paid in full from the 15th December, 2025 to the 31st December, 2025.”
During this window, property owners who settle their outstanding principal land rates will not be required to pay any penalties or interest that may have accumulated.
This move is expected to ease the financial burden on ratepayers while enabling the county to recover significant arrears before the close of the financial year.
Revenue Mobilization Strategy by Sakaja
The Nairobi County Government has long struggled with low compliance with land rate payments, despite these payments being a critical revenue stream for funding essential services such as waste management, road maintenance, and healthcare.
Nairobi remains the single most significant contributor to pending bills among Kenya’s 47 counties.
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Accumulated penalties and interest have often discouraged property owners from settling their dues, leaving the county with billions in arrears.
Governor Sakaja’s administration views the waiver as a strategic intervention to reverse this trend.
By eliminating penalties and interest for a limited period, the county aims to encourage property owners to clear outstanding balances and restore compliance.
The administration expects this approach to generate significant cash flow into county accounts before the close of the financial year, enabling the government to meet budgetary obligations and improve service delivery.
“This waiver is a strategic measure to enhance compliance and improve cash flow for the county. We urge all property owners to take advantage of this opportunity before the deadline.”
Nairobi County Pending Bills and Historical Debt
The current Nairobi County administration continues to grapple with a heavy debt load inherited from previous regimes.
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When Governor Sakaja assumed office in August 2022, Nairobi County had pending bills totaling Ksh118 billion, including Ksh16 billion from the defunct Nairobi Metropolitan Services (NMS).
By June 2025, the county had reduced this figure to Ksh86.77 billion after clearing approximately Ksh35 billion through reconciliation and negotiated settlements.
A significant portion of the debt comprises legal fees amounting to KSh21.4 billion, with KSh6.3 billion owed to just four law firms.
Pension arrears exceeding Ksh4 billion remain unpaid to former Nairobi City Council employees, prompting calls for prioritization.
To ease the burden, Governor Sakaja has entered a Ksh2.7 billion debt-swap agreement with the national government, offsetting liabilities tied to land compensation and withheld land rates.
Despite these efforts, Nairobi still faces challenges, including Ksh11 billion in unrecovered receivables, a wage bill consuming 65% of revenue, and water sector losses valued at Ksh8.6 billion due to leaks and theft.
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