CS Mbadi Reveals New VAT Changes After Postponement of PAYE Review

Stakeholders are already pressing the government to review VAT, which makes up a significant portion of key products such as fuel prices...

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Kenya's Treasury is planning to change the Value Added Tax (VAT) on fuel from an ad valorem system to a specific tax model to stabilise pump prices amidst rising global oil costs.

The proposed shift aims to impose a fixed amount of VAT per litre, potentially offering relief compared to the current percentage-based system.
Treasury Cabinet Secretary John Mbadi presented the proposal to the National Assembly Finance Committee.
This move is intended to curb speculative hoarding and ensure fuel price predictability, with the Treasury reassuring the public about fuel supply and reserves, which currently stand at approximately 16 days of petrol, 19 days of diesel, and 49 days of kerosene.