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Fuel Crisis Kenya Fuel prices to drop after Uhuru's announcement today

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Uhuru offers new solution to high fuel prices

President Uhuru Kenyatta orders VAT tax to drop by 50 percent play President Uhuru Kenyatta orders VAT tax to drop by 50 percent (PSCU)

President Uhuru Kenyatta on Friday announced a slight drop in the VAT tax introduced against fuel products, scrapping off the 16 percent and setting it at 8 percent.

The new directive by President Kenyatta will see a slight drop in the price of super petrol dropping from Sh128 to around Sh118. The price of diesel will also drop from the high of Sh115 to about Sh107.

The President's directive, however, is dependent on whether Parliament will pass the Finance Bill 2018 which had sought to suspend VAT for the next two years.

play President Uhuru Kenyatta orders VAT tax to drop by 50 percent (Courtesy)

 

The head of state said he declined the Finance Bill 2018 given the high cost of running government which he attributed to various factors including the new constitution and the mega development projects under his adminstration.

He said suspending the VAT measure would have heavily strained the government's ability to meet its financial obligations.

The President also quoted the war on corruption and the demolition of buildings as some of his bold actions that have required financing and contributed to the need to raise more money through taxes.

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