President Uhuru Kenyatta on Thursday evening rejected the Finance Bill 2018 which Kenyans had hoped he would assent to.
Earlier on, National Assembly Speaker Justin Muturi had been accused of deliberately sitting on the Bill.
The President’s rejection of the Bill now puts to rest the ongoing stalemate over the 16 per cent VAT on fuel.
Minority Leader John Mbadi had on Thursday described Mr Muturi’s action as “unfortunate and dishonest”.
The MP said inquiries at the clerk’s office showed that the Bill was concluded for forwarding to the President a week ago but it had been lying at Mr Muturi’s office.
The revelation had fanned fears that the government was intentionally delaying the signing into law of the Bill that would have seen tax on petroleum products put on hold for two years.
There are no timelines in law for Parliament to forward the Bill to the President once passed by MPs. The law only stipulates that the President’s assent to a Bill must be done within 14 days of receipt or return it to Parliament with a memorandum failing which it automatically becomes law.
The controversial tax which came to effect on September 1 has seen fuel prices go up further escalating the cost of living. The levy has been the subject of public uproar for the last two weeks.
Parliament will hold a special sitting on September 18 to reconsider the Finance Bill “together with the reservations of the President”, said the gazette notice signed by Mr Muturi.
The notice did not say why Mr Kenyatta rejected the Bill as passed by Parliament in late August.
Mr Kenyatta’s spokesperson Ms Kanze Dena said the President would address the country on the matter on Friday.
—Additional reporting by Reuters