Ruto signs fuel VAT extension as motorists react to EPRA’s latest price review

Nairobi, Kenya — President William Ruto has signed a law extending the reduced 8% Value Added Tax (VAT) on fuel for another 90 days, following the Energy and Petroleum Regulatory Authority's (EPRA) latest price adjustment. The Tax Laws (Amendment) Act 2026 allows Treasury Cabinet Secretary to extend the reduced VAT rate. On October 14, EPRA announced new maximum retail prices that maintain an 8% VAT for the October 15 to November 14 period.

Petrol in Nairobi saw a Sh12.93 increase to Sh226.96 per litre, while diesel rose by Sh9.90 to Sh227.76. Kerosene experienced the steepest rise, up by Sh28.49 to Sh219.87 per litre. EPRA stated that these prices include the 8% VAT, aimed at protecting consumers from high international petroleum prices. The previous relief period ended on October 14, prompting questions about the extension's timing and legal basis.

EPRA's price review cited increases in the cost of imported refined petroleum products. The average landed cost of imported petrol rose by 11.81%, diesel by 11.32%, and kerosene by 9.41%. Despite the lower VAT rate, the price hikes have reignited concerns about the cost of transport, household energy, and essential goods. The Motorists Association of Kenya (MAK) has called for an independent audit of the fuel-price review and demands transparency in the government-to-government (G-to-G) petroleum import arrangement.

MAK questioned the link between landed costs and final pump prices, particularly for kerosene, which had the highest percentage increase despite the lowest reported landed cost increase. The association requested EPRA to disclose detailed pricing calculations, including international benchmarks, freight, insurance, taxes, and margins.

They also sought information on the costs and benefits of the G-to-G arrangement, such as supplier premiums, financing costs, freight charges, and foreign-exchange risks. MAK argues that consumers should be able to differentiate between the impacts of international market changes and domestic policy decisions.