BY NAMULONGO PETER,NAIROBI,14TH SEPT 2018-After the outcry that has met the implementation of 16% of value added Tax (VAT) imposed on petroleum products in the country president , Uhuru Kenyatta has now proposed to have the said tax reduced by a half.
This mean that the current 16% VAT tax according to him should be cut down to 8%.
In his address to the nation on Friday afternoon, President Kenyatta said he has sent back to the National Assembly the Finance Bill 2018 that proposed a moratorium of two years on the proposed increase.
“I returned it (Finance Bill 2018 to Parliament with a number of modifications,” the president said.
The 16 percent VAT on Fuel Products came to effect on September 1, 2018, but has since been challenged at the High Court leading to an order suspending it but it has not been honored by the Energy Regulatory Commission (ERC).
The reduction if effected will see Super Petrol drop from the current Sh127 to Sh118 while Diesel will cost Sh107 from Sh115.
While defending the move not to postpone the implementation of the tax in totality ,the head of state said the move is aimed at ensuring that the government is able to implement various development project that are inline with the new constitution that was passed in the year 2010.”Fellow Kenyans you are all aware that since 2013 we have not imposed any tax despite the fact that we have had the constitution that has to be implemented, while we understand the frustrations brought about by the introduction of this VAT tax ,we have to work”.He said.
Kenyatta has also urged business men do ensure that they lower the cost of their products in accordance with the reduction in the VAT just like they were quick to increase when it was announced.