Ruto Signs Law Slashing Fuel VAT to 8% for Three Months
News Updated: 17 April 2026 15:55 EAT
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President William Ruto has assented to the VAT (Amendment) Bill, 2026, paving the way for a temporary reduction of Value Added Tax on petroleum products from 16 percent to 8 percent.
The new law allows the National Treasury to implement the reduced VAT rate for a 90-day period, targeting immediate relief for consumers grappling with high fuel costs.
The measure follows swift approval by the National Assembly, which passed the Bill as an emergency intervention amid rising global oil prices and mounting economic pressure on households.
The tax cut applies to key petroleum products including petrol, diesel and kerosene, effectively halving the VAT component and lowering pump prices in the short term.
Government officials say the move is designed to cushion Kenyans from the ripple effects of expensive fuel, which has driven up transport costs, food prices and the overall cost of living.
The law also includes a provision allowing the government to review or extend the tax relief beyond the initial 90 days, depending on market conditions and economic impact.
The intervention comes against the backdrop of volatile global oil markets, with authorities citing external shocks and geopolitical tensions as key drivers of the recent surge in fuel prices.
While the VAT reduction is expected to offer immediate relief, analysts note it remains a short-term measure, with calls growing for broader structural reforms in fuel pricing and taxation.
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FELIX MAKONA
FACT FINDER AND DATA DRIVEN JOURNALIST. DATA MINING AT IT'S BEST. GET FACTS RANGING FROM MATTERS DISABILITY AND INCLUSION, POLITICS, ECONOMY, SPORTS AND GENERAL NEWS AROUND THE WORLD