Ruto assents to bill sustaining 8% VAT on petroleum products
Ruto assents to bill sustaining 8% VAT on petroleum products
President William Ruto on Friday, October 16, signed the Tax Laws Amendment Bill 2026 into law at the Eldoret State Lodge.
The bill, which was introduced in the National Assembly by Kikuyu MP Kimani Ichung’wah, amends section 5 of the Value Added Tax (VAT) Act and sets a reduced VAT rate for petroleum products at 8 percent from 16 percent.
National Assembly Clerk Samuel Njoroge, while highlighting the bill, said the new law sustains 8% VAT on petroleum products for 90 days.
He noted that the VAT can be extended for an additional 90 days if the crisis in the Middle East does not improve.
“The bill sustains the 8 percent VAT application on petroleum products to ensure that the effect of the crisis that has been seen in the Middle East does not affect the Kenyan economy. The bill ensures that the 8 percent VAT is sustained for a period of 90 days, and if the situation in the Middle East does not improve, it is extended for another 90 days,” said Njoroge.
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The new law also changes the basis for taxing tiles from weight in kilograms to area in square meters, with the rate reduced to Ksh400 per square meter.
It further reduces the tax on ceramic instruments from Ksh50 to Ksh30 per kilogram.
President Ruto also assented to the Kenya Revenue Authority (Amendment) Bill, which provides for the Kenya Ports Authority (KPA) Managing Director to sit on the KRA Board.
“It recognizes the symbiotic relationship between the management of the Kenya Ports Authority and revenue collection. It therefore brings the Managing Director of KPA into the board of the Kenya Revenue Authority so that decisions made in KRA are also felt in KPA.
The legislation also makes the Attorney-General, the Principal Secretary for Finance and the KRA Commissioners substantive members of the KRA Board, rather than serving as ex-officio members as previously provided.
This comes a month after President William Ruto signed four new bills into law at State House, Nairobi.
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