Fuel prices unchanged countrywide Saturday

Fuel prices didn’t change across the country on Saturday.

Motorists were set to pay a record Sh131.93 per litre of petrol or about Sh18.20 more beginning September 1, sparking fears of a sharp rally in inflation.

A spot check by the Nation team in Malindi, Nyandarua, Isiolo, Kisumu, Makueni, Migori, Mombasa, Kisii and Embu revealed that fuel prices were unchanged Saturday.

Petrol stations in Nyandarua County registered double sales since Friday night as motorists refilled their vehicles and others took extra litres for stock.

At a Total petrol station in the county prices remained Sh114.60, Sh104.80, and Sh86 for petrol, diesel, and paraffin respectively.

Parliament Wednesday dealt a decisive blow to the Treasury’s bid to impose higher taxes on fuel after unanimously voting to delay for a further two years the implementation of 16 per cent value added tax (VAT).

But focus is now on President Uhuru Kenyatta whose final signature is needed to give amendments to the Finance Bill, 2018 legal force.

The IMF-imposed tax would have seen the cost of a litre of petrol surge to a record Sh131.93 beginning Saturday.

While the vote offers a huge relief to consumers, it leaves the government Sh71 billion short of its revenue estimate, which could force Treasury secretary Henry Rotich to either trim his spending estimates or take up more debt.

Industry and consumer lobby groups had warned that the tax would set off steep price increases and stall overall economic growth.

National Assembly Minority Whip Junet Mohammed moved the proposal to defer implementation of the contentious VAT until September 2020, with plans to further defer the tax until 2022 in an amendment set for debate today.

In voting against the tax, the MPs said introduction of VAT on petroleum products will “touch off a button” for a rally in the cost of commodities and transportation, hitting ordinary Kenyans hard.

“This House has been accused of not being sensitive to the needs of the people. It is time we side with them and I plead that we postpone this tax to 2020,” said Mr Mohammed while moving the amendment.

Homa Bay Woman Representative Gladys Wanga said the heavy burden Kenyans are facing currently cannot allow MPs to impose additional taxes that stand to hurt poor families most.

“The most critical thing is that IMF is forcing us into this matter. We cannot rob the poor to fund our budget. Even as we postpone this tax for a further two years, this House must decide to either do away (with it) or not,” Minority Leader John Mbadi said.

Reporting by Waikwa Maina, Charles Lwanga