The government has announced a fresh Ksh945 million fuel subsidy and extended tax relief on petroleum products to protect Kenyans from a possible increase in fuel prices.

🇰🇪 Breaking It Down

The announcement comes as the Energy and Petroleum Regulatory Authority (EPRA) prepares to announce new fuel prices for the July-August pricing cycle later today.

Addressing the press on Tuesday, July 14, Energy and Petroleum Cabinet Secretary Opiyo Wandayi announced that the government has extended the 8 per cent Value Added Tax (VAT) on petroleum products for another three months until October 2026.

He said the extension is to allow consumers to continue benefiting from the lower tax rate while cushioning households and businesses from volatile global oil prices.

📌 What You Need to Know

Wandayi also announced that the government would inject Ksh945 million from the Petroleum Development Levy during the July-August fuel pricing cycle to help sustain the current pump prices.

"As a government, we have invested heavily in building a more resilient petroleum sector. As part of the government's commitment to cushioning households and businesses from international oil market volatility, we have extended the 8 per cent VAT on petroleum products for a further three months until October 2026," Wandayi said.

"Further, in the July-August fuel pricing cycle, the government will deploy subsidies from the Petroleum Development Levy to the tune of Ksh945 million to sustain the current price levels," he added.

The CS also sought to calm fears over fuel availability, assuring motorists and businesses that the country has sufficient petroleum stocks despite uncertainties in the global energy market.

According to the CS, the Government-to-Government (G2G) fuel import arrangement has enabled Kenya to source cargoes from alternative regions, ensuring uninterrupted fuel supplies even as shipping disruptions persist in the Middle East.

He explained that because Kenya continues to pay fixed freight and premium charges under the arrangement, the country has managed to keep landed fuel costs relatively stable while maintaining reliable fuel deliveries.

📰 Source: Kenyans.co.ke