The Value Added Tax (Amendment) Bill, 2026
Status Timeline
Proposed
Done ยท 15 Sep 2026
Public Review
Done
Debate
Done
Executive
Done
Enacted
Active now
VAT Rate on Petroleum Cut to 8%
The Bill introduces sub-section (2A) to Section 5 of the Value Added Tax Act, lowering the VAT rate on specific petroleum products from 16% to 8%. The affected products include:
- Motor Spirit (gasoline) premium (tariff number 2710.12.20)
- Illuminating Kerosene (tariff number 2710.19.22)
- Gas Oil (automotive, light, amber for high-speed engines) (tariff number 2710.19.31)
Temporary 90-Day Relief with Extension Option
The reduced 8% tax rate is set to remain in force for an initial period of ninety (90) days from the commencement of the Act. The Cabinet Secretary may extend this period for a further ninety (90) days via a notice in the Gazette.
Bill No.
No. 21 of 2026
Gazette No.
Supplement No. 101 of 2026
Sponsor
Kimani Ichung'wah
Background
The principal object of the Value Added Tax (Amendment) Bill, 2026 is to amend the Value Added Tax Act (Cap. 476) to reduce the VAT rate on petroleum products. This tax measure is designed to cushion citizens from the rising global prices of fuel.
Key Amendments
The Bill proposes to insert two new sub-sections under Section 5 of the Value Added Tax Act:
- Section 5(2A): Lowers the VAT rate to eight (8) percent of the taxable value for specific petroleum products, namely:
- Motor Spirit (gasoline) premium of tariff number 2710.12.20;
- Illuminating Kerosene of tariff number 2710.19.22; and
- Gas Oil (automotive, light, amber for high-speed engines) of tariff number 2710.19.31.
- Section 5(2B): Limits the application of the reduced rate to an initial ninety (90) days from the date the Act comes into effect. It also empowers the Cabinet Secretary to extend this period for an additional ninety (90) days by publishing a notice in the Gazette.
Transitional Provisions
The Act is deemed to have come into effect on 15th April, 2026.
Gazettement
The Value Added Tax (Amendment) Bill, 2026 was published in the Kenya Gazette No. 101.
First Reading
The Bill was read a First Time in the National Assembly.
Second Reading
The Bill was read a Second Time and debated in the House.
Committee of the Whole House
The Bill was considered clause-by-clause in the Committee of the Whole House.
Third Reading
The Bill was read a Third Time and passed by the National Assembly.
Presidential Assent
The Bill was assented to by the President, enacting it into law.