Ruto Announces Plan to Cut Fuel VAT to 8% to Ease Cost of Living

President William Ruto has announced new measures to help Kenyans cope with the rising cost of fuel.

In a statement released on Wednesday, April 15, 2026, the President said the government is taking action to reduce the impact of increasing fuel prices, which have been affected by global supply challenges linked to tensions in the Middle East.

Government Steps In to Control Fuel Prices

According to Ruto, the rise in fuel prices has been caused by instability in the international market. He explained that fuel costs affect many areas of life, including transport, food prices, and other basic needs.

To protect citizens, the government has introduced a plan to make fuel more affordable and reduce pressure on households and businesses.

He said the move is part of a wider effort to keep the cost of living manageable for ordinary Kenyans.

VAT on Fuel to Be Reduced

One of the key changes announced is a reduction in Value Added Tax (VAT) on fuel. The government plans to cut VAT from 16% to 8% for the next three months.

This decision is expected to help lower fuel prices and reduce expenses for consumers across the country.

Role of Fuel Import Deal

The President also highlighted the importance of the government-to-government fuel import deal, which has been helping to stabilise fuel supply and prices over time.

He said the agreement has played a key role in preventing extreme price increases at fuel stations.

Additional Subsidy to Support Consumers

Apart from the tax reduction, the government will also provide financial support to cushion Kenyans from further price increases.

Ruto announced a KSh 6.5 billion subsidy from the Petroleum Development Levy. This support is meant to reduce the burden on consumers and prevent a sharp rise in fuel prices.