The National Super Alliance (Nasa) has offered conditional support to President Kenyatta’s memorandum to Parliament cutting VAT on fuel from 16 percent to eight percent.
A parliamentary group meeting of the Raila Odinga-led coalition on Tuesday resolved to support the tax, which is set to substantially raise the cost of living, for a year.
The backing came after a three-hour meeting at Orange House in Nairobi, chaired by Mr Odinga.
The meeting was attended by MPs from all Nasa-allied parties — Mr Odinga's Orange Democratic Movement, Kalonzo Musyoka's Wiper and Moses Wetangula's Ford-Kenya.
"In light of the need to address the suffering of the people while ensuring that development is also delivered, we recognise and appreciate that there was bilateral support for our attempt to remove VAT altogether and the president was able to meet us half way by lowering the tax from 16 to eight percent,” the MPs said in a joint statement read by National Assembly Minority Whip Junet Mohammed.
“Nasa therefore offers its conditional support for the initiative to cut VAT from the initial 16 percent to eight.”
The coalition, however, wants the government to eliminate wastage and be economical with the resources.
The opposition also wants Mr Kenyatta’s administration to be sensitive to hard financial times facing Kenyans and live within its means.
On expiry of the 12 months, the lawmakers said in the joint statement, the tax will be subject to review and possible scrapping.
Their statement comes hours to the a special sitting of the National Assembly to debate Mr Kenyatta's memo.
Last week, President Kenyatta announced that he had rejected the bill deferring implementation of the tax until 2020 and slashed the 16 percent tax by 50 percent.