Price of LPG Cooking Gas to Drop as MPs Endorse Proposal to Slash VAT

Members of Parliament have endorsed a proposal to amend the proposed amendment to Finance Bill 2022 to slash the Value Added Tax on LPG gas from 16 per cent to 8 per cent, a relief for many homes who rely on domestic cooking gas.

The proposed changes to the law come a year after Parliament reinstated the 16 per cent VAT on cooking gas, which together with a rally in crude prices has seen the cost of the 13kg LPG rise by Sh900 since June.

Costly gas added to the rising fuel and food prices, pushing inflation to a 27-month high. The proposal to halve VAT was fronted by Kikuyu MP Kimani Ichung’wah.

“Section 5 of the Value-Added Tax Act, 2013 is amended by in the case of the supply of liquefied petroleum gas, including propane, eight percent,” says the proposal.

The slashing of the VAT on cooking gas is contained in the Petroleum Products (Taxes and Levies) Amendment Bill, 2021 passed by the National Assembly Committee on Finance and National Planning.

The law will see the price of the 13-kilogramme cooking gas will fall by at least Sh230 if MPs approve changes to the law halving the value-added tax (VAT) on the commodity.

The Kenya Revenue of Authority had initially petitioned to maintain the 16pc VAT arguing that it would lose out on revenue.

Read also; National Treasury to Revive LPG Subsidy.

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