Ruto announces fuel VAT cut from 16% to 8%

Speaking during his tour of the Gusii region on Wednesday, the President said the government had also injected Sh6.5 billion to stabilise pump prices after the latest review by the Energy and Petroleum Regulatory Authority (EPRA) pushed costs significantly higher.

“We have managed to moderate prices. I am announcing today that the fuel prices that have gone up, we have stepped in as the government with Sh6.5 billion to reduce the cost of fuel. We have also stepped in to bring down VAT from 16 per cent to 8 per cent for the next three months,” Ruto said.

His remarks came a day after EPRA announced steep increases in fuel prices for the April–May cycle, with Super Petrol rising by Sh28.69 per litre and Diesel by Sh40.30, while kerosene prices remained unchanged.

The increase, driven by a surge in global oil prices, triggered immediate concern among motorists and households already grappling with the high cost of living.

Across major towns, motorists expressed frustration at the pump, warning that the spike would inevitably push up transport fares and the cost of basic commodities.

Public service vehicle operators signalled possible fare hikes, while logistics players cautioned that higher diesel prices would increase the cost of moving goods across the country.

In his address, Ruto acknowledged the global nature of the crisis, noting that fuel prices had risen worldwide due to ongoing geopolitical tensions affecting oil supply chains.

“There are those saying fuel prices have gone up and want to start demonstrations. I ask, if we hold protests, will the price of fuel go down?” he posed.

The President urged Kenyans to remain calm, saying the government was focused on practical solutions to shield consumers rather than political agitation.

He further assured the public that the government would maintain stable kerosene prices to protect low-income households and small-scale users, including boda boda operators who rely on the fuel for daily livelihoods.

“We have made sure that paraffin used by ordinary citizens does not increase, because we want to cushion the people of Kenya,” he said.

The VAT reduction marks one of the most direct fiscal interventions by the government in recent months, aimed at softening the impact of global price shocks.

It is expected to slightly lower the final pump price consumers pay, although analysts note that the relief may be limited given the magnitude of the recent increases in landed fuel costs.

Data from EPRA shows that the average landed cost of imported petroleum products rose sharply between February and March, with diesel recording the highest jump, further compounding pressure on local prices.

Kenya, which imports all its refined petroleum products, remains highly exposed to international market fluctuations and exchange rate movements, making domestic price controls challenging.

Ruto, however, maintained that the government would continue to monitor the situation and intervene where necessary.

“I want to assure Kenyans that this government will ensure prices do not rise excessively, and that we have sufficient fuel supply,” he said.