Ruto bids to increase tax on fuel

Ruto bids to increase tax on fuel

Ruto bids to increase tax on fuel. President William Ruto’s effort to bring back an unpopular fuel tax that his predecessor was forced to drop reveals leaders’ double-talk on a topic of great public concern and rekindles the politics that surround petroleum pricing.

Kenyans have been advised to prepare for higher living expenses starting on July 1 in the event that a proposal in the Finance Bill 2023 to subject petroleum items to a 16 percent Value Added Tax (VAT), up from the current eight percent, is put into effect.

 

The responsibility of promoting the Bill in the House will fall to the National Assembly Majority Leader Kimani Ichung’wah and Budget Committee Chairman Ndindi Nyoro, who will effectively be whipped into passing the controversial law that they adamantly opposed in 2021.

Audit firm KPMG, in its review of the Bill, warns the proposal “is likely to impact the prices of transport and production of goods, increasing the inflationary pressure on the economy.”

Ruto bids to increase tax on fuel

On Sunday May 7, matatu owners warned commuters fare hikes will be inevitable if the higher taxes are imposed on fuel.

 

“We know very well that for products to reach consumers they have to be transported, so every product’s prices will go up,” said Matatu Owners Association Chairman Simon Kimutai.

 

Following the implementation of the 16% VAT on all petroleum products, which led to an increase in transportation and gasoline expenses, the Kenyatta administration was confronted with a strike by some oil dealers, protests from commuters, and legal action.

The House session was so tumultuous that some MPs left the National Assembly, which led Soipan Tuya, the then-chairperson of the Committee on the Whole House, to call a recount in order to determine quorum. When the House reconvened in plenary following MPs’ complaints over the voting process, then-Speaker Justin Muturi struggled to maintain composure. For 15 minutes, the Speaker put the meeting on hold so that legislative officials could analyze the situation.

Bid to increase tax

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