Kenyans woke up this week to a political economy lesson they did not ask for. In the space of seventy-two hours, the price of a litre of petrol in Nairobi jumped, fell, and then settled — at a level set not by the market, not by the Energy and Petroleum Regulatory Authority (EPRA) acting within its statutory mandate, but by a political decision dressed up as a legal notice and hurriedly chased through Parliament to keep it from collapsing in court.
The sequence matters. On 14 April, EPRA’s monthly review pushed Super Petrol in Nairobi to Ksh206.97 and Diesel to Ksh206.84 — painful figures that landed in a country already choking on food inflation and a shilling fluttering against an oil-price spike caused by the widening Iran conflict. Within twenty-four hours, public outrage forced a retreat. The National Treasury issued a legal notice cutting the VAT on petroleum products from 13% to 8%. EPRA dutifully revised the pump prices to Ksh197.60 for petrol and Ksh196.63 for diesel. The following day, the National Assembly passed the Value Added Tax (Amendment) Bill, 2026, lowering the statutory rate to 8% for three months.
On the surface, this is a government listening to its people. Underneath, it is an executive that tried to do by decree what the Constitution reserves for Parliament — and only remembered to ask for permission after the fact.
The law the Treasury quietly sidestepped
The VAT Act, 2013 is explicit. Section 6(2) permits the Cabinet Secretary for Finance to adjust a VAT rate by “an amount not exceeding twenty-five per cent of the rate specified.” A cut from 16% to 12% is legal. A cut from 16% to 8% — a 50% haircut — is not. It requires parliamentary amendment.
Yet the first move this week was a Treasury legal notice, not a Bill. The Cabinet Secretary reached for an authority he did not have, EPRA acted on it, and motorists pocketed the savings before any MP had voted. The Bill that came to the floor on Thursday was not the instrument of reform; it was a legal parachute, unfurled mid-fall.
Constitutional lawyers have already flagged the breach. Article 210(1) of the Constitution states that no tax may be imposed, waived or varied except as provided by legislation. The Treasury’s 15 April legal notice was, in effect, a variation of a tax outside the permitted statutory ceiling. Even now, with the Bill passed, there is the awkward matter of the 24 hours during which motorists paid a rate that had no lawful basis. Any filling station, tax consultant or opposition MP with a good lawyer has a petition waiting.
The politics behind the shortcut
Why would a government with a working majority in both Houses — one that has publicly flirted with an ODM-UDA coalition — take the long way around its own Constitution? Because the calendar matters more than the statute book.
President William Ruto is running out of economic goodwill. Fuel, unga and electricity now function as the three-legged stool of Kenyan political moods, and the stool has wobbled all year. A unilateral VAT cut, announced before Parliament could convene, let State House claim the political win. By the time MPs got to the floor, the relief was already at the pump. The Bill became a formality, the debate theatre.
This is of a piece with a governance style that has defined the Kenya Kwanza administration: announce, then legislate; promise, then scramble to find the legal vehicle. It works when the policy is popular. It breeds impunity when it is not.
What this means for Kenya
Three consequences are already visible. First, EPRA’s credibility — never robust — has taken another knock. In one week the regulator raised prices on a global-market basis, then cut them on a political-directive basis, then cut them again after a legal notice of dubious validity. Motorists can be forgiven for concluding that the monthly pricing formula is whatever the Cabinet Secretary says it is.
Second, the opposition now has a clean constitutional grievance to pair with its economic one. Rigathi Gachagua’s camp and a restive wing of ODM — itself demanding “total respect” from UDA this week as zoning talks stall — will weaponise this. Expect court filings and floor fights through May.
Third, and most consequential: the three-month clock. The VAT cut expires in July. Either Parliament extends it, in which case the revenue hole widens and the IMF notices; or it lapses, and petrol climbs back toward Ksh210 just as campaign season opens for 2027. Neither outcome favours the government.
What to watch next
Watch the petitions. Watch the Office of the Attorney-General for any opinion explaining the 24-hour gap. Watch ODM’s parliamentary bloc, which voted for the Bill but is openly hunting for leverage. And watch the price of Brent crude — because if the Gulf lights up further, the 8% fix will not be enough, and the next shortcut may be harder to hide.
Ruto has bought three months of pump peace. He has borrowed them against the Constitution. The interest is due in July.
