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President William Ruto has returned the Conflict of Interest Bill 2025 to Parliament for reconsideration.
According to a statement from State House Spokesperson Hussein Mohamed, President Ruto cited the need to strengthen its provisions on transparency, accountability, and enforcement.
The head of state argued that while the bill addressed key concerns around conflict of interest, it required further refinement to align with constitutional values of good governance.
The Head of State warned that he would not approve any legislation that does not meet high standards of accountability and anti-corruption safeguards.
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“In his commitment to tackling corruption, accountable leadership and integrity in public service, the President has been urging Parliament to pass the Conflict of Interest Bill without delay,” read part of the official statement from State House.
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“He, however, made it clear that he would veto any version of the Bill that failed to set a high standard for accountability, integrity, and anti-corruption measures.”
Citing Article 115 of the Constitution, the president officially sent the Bill back with proposed changes for Parliament to reconsider.
Tax Cut on Transformers Approved
President William Ruto has assented to the Excise Duty (Amendment) Bill, 2025, officially scrapping the 25% excise duty on imported fully assembled electric transformers and their parts.
The tax cut is expected to directly reduce the cost of transformers, critical components in electricity distribution, thereby easing electricity connection costs for new customers.
Additionally, the move is anticipated to relieve the Kenya Power and Lighting Company (KPLC) of financial strain, enabling the utility firm to procure transformers within its current budget, improve grid reliability, and avert prolonged power outages.
This positive change stems from a policy mistake made last year.
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Background on the Transformer Tax
In December 2024, the government introduced a 25% excise duty on imported transformers through the Tax Laws (Amendment) Act, 2024.
The policy was designed to encourage local manufacturing by making imports less attractive, a classic “Buy Kenya, Build Kenya” strategy.
However, it quickly became apparent that the policy had unintended consequences.
Kenya, it emerged, did not have the manufacturing capacity to produce transformers at scale.
Local companies were merely assembling parts imported from abroad.
The duty on these parts not only drove up production costs but also rendered local firms uncompetitive in both local and export markets.
KPLC, the national electricity distributor, was among the hardest hit.
The utility said the tax would drive up the cost of transformers and it would struggle to replace faulty transformers, which has been a key reason behind recent power outages and delays in electricity connections.
The inflated costs also raised fears of potential increases in electricity tariffs, hurting both consumers and industrial players.
MPs Scramble to Correct Act
Amid mounting pressure from energy stakeholders, manufacturers, and consumer rights groups, MPs began a hurried effort to amend the law through The Excise Duty (Amendment) Bill, 2025.
The Bill garnered bipartisan support, and after smooth passage through Parliament, it was presented to President Ruto, who signed it into law in April 2025.