Kenyans to face tough economic times as KRA effects 16% VAT on petroleum products

Kenyans to face tough economic times as KRA effects 16% VAT on petroleum products

BY ANMULONGO PETER,NAIROBI,1ST SEPT 2018-Kenyans will have to content  with tough economic times after the Kenya revenue Authority made true its threats to effect 16% VAT  on  petroleum products  starting Today (September 1st 2018)

Following this development ,Petrol and Diesel Pump prices are expected to increase by 10 percent while Kerosene will increase by 12 percent which will translate to increases in the pump prices to Sh125.21 per litre for Petrol, 112.90 per litre for Diesel and 95.19 per litre for Kerosene.

According to a  statement send to newsrooms , KRA has advised importers, depots, distributors and retailers, including pump stations, to charge, account and submit returns on the same to KRA by 20th of the succeeding month.

“The changes are contained in the Finance Act 2013 which extended the exemption for three (3) years. Further, the exemption was extended by two more years under the Finance Act 2016. Consequently, the VAT charge on petroleum products has now come into effect,” reads a statement from KRA.

Additionally , KRA says it has instituted measures to support oil industry players in complying with the law.

“We have also engaged the Energy Regulatory Commission in order to ensure coordinated action by relevant Government agencies.”

Parliament had on Wednesday voted to postpone the implementation of the VAT for two more years until 2020, citing the already high cost of living.

It will be remembered that the  coming into effect of the VAT was contained in the Finance Act 2018, with any amendments by parliament requiring  the President’s approval.

It is not clear however whether President Kenyatta who has traveled to  Beijing for the China – Africa Summit  had signed any pending bills.

 

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