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COMMUTERS BEGIN TO FEEL PINCH OF FUEL TAX AS FARES INCREASE

Public transport fares increase after fuel tax takes effect

Commuters have become the first set of wananchi to feel the impact of the imposed 16 percent VAT added on petroleum products as fares across different routes increase.

In most routes within the city, the bus fares increased by an average of Sh 20 while some inter-county routes the fares went up by sh100.

Matatu operators had warned that fares will increase by at least Sh30 from September 1, when the 16 percent fuel levy comes into effect.

“We are aware that the fare increase will be painful for the commuters, but it has to take effect because the taxation of fuel translates into an added cost for operators,” said Matatu Owners Association chairman Simon Kimutai.

Economists have warned that the increased cost of fuel would generally increase the cost of living and make life even more difficult for mwananchi.

Last week parliament voted to suspend the proposed fuel levy but treasury CS Henry Rotich stayed adamant about its implementation.

The legislators have threatened to impeach him for disregarding them.

Minority Leader in the National Assembly John Mbadi has said that the fuel tax implementation is a “crisis” and urged that Parliament is recalled to address the situation.

“It was a mistake from the beginning to conceive this tax. The Sh70 billion is a small component of the entire budget and we can explore other ways of raising it instead of robbing the poor to fund the budget,” Mbadi said.

Rotich’s move to implement the fuel levy has also been condemned by the Central Organisation of Trade Unions (Cotu) and the Consumer Federation of Kenya (Cofek).

“We have opposed this tax as much as we condemn KRA and National Treasury. We ask them to respect Parliament as the expression of the sovereign will of the Kenyan people,” said Francis  Atwoli, Cotu Secretary-General.

The government expects to raise Sh70 billion through the 16 percent VAT on petroleum products.

The proposed tax has seen petrol prices shoot to more than Sh131.93 per litre in Nairobi, while diesel and kerosene will cost highs of Sh119.18 and Sh98.54 from the current Sh102.74 and Sh84.95 per litre, respectively.

MPS VOTE TO SUSPEND FUEL TAX FOR TWO YEARS

 

 

 

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