[PHOTOS] Ruto signs two tax laws on fuel VAT and construction costs

President William Ruto has signed two tax laws introducing changes to Value Added Tax (VAT) on petroleum products, excise duty on construction materials and the composition of the Kenya Revenue Authority (KRA) board.

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The President assented to the Tax Laws (Amendment) Bill, 2026, and the KRA (Amendment) Bill, 2026, at Eldoret State Lodge on Friday, October 16.

The Tax Laws (Amendment) Act provides for a reduced VAT rate of eight per cent on petroleum products, down from 16 per cent, in a move intended to cushion Kenyans against rising fuel prices.

The legislation, introduced by National Assembly Majority Leader Kimani Ichung’wah, amends Section 5 of the Value Added Tax Act to provide for the reduced rate for a period of 90 days.

The National Treasury Cabinet Secretary may extend the period for a further 90 days through a Gazette notice.

The measure comes amid rising global oil prices linked to the crisis in the Middle East, which has put pressure on petroleum costs and raised concerns about the cost of living.

The law also amends the Excise Duty Act by changing the basis for calculating excise duty on tiles from weight to size.

It further revises the description of imported flat glass to align it with protocols ratified by the East African Community, paving the way for imports from other EAC partner states without excise duty under the applicable regional arrangements.

The changes are intended to support the construction and housing sectors by addressing taxation affecting building materials.

Separately, the KRA (Amendment) Act revises provisions governing the appointment, tenure and removal of members of the authority’s board.

The law amends Sections 7 and 8 of the KRA Act by removing references to the term “ex officio member” to align the legislation with the current composition of the authority’s board and provide for equitable treatment of members in appointment and removal processes.

It also introduces the managing director of the Kenya Ports Authority (KPA) as a member of the KRA board, recognising the interdependence of the two institutions’ operations.

KRA is responsible for collecting government revenue, while KPA manages port operations that facilitate the movement of imports and exports into and out of the country.