By Macharia Kamau
Nairobi, Kenya: The Kenya Revenue Authority (KRA) has put rogue operators in the petroleum industry on notice.
This is as it looks to seal loopholes in revenue collection as well as safeguard consumers of petroleum products in the country.
The taxman on Thursday said he will crack the whip on illegal operations in the sector. Rogue merchants have seen petroleum products meant for exports sold in Kenya as they evade taxes. KRA is also targeting operators who mix motor vehicle fuels with kerosene to increase the volumes of their products.
Such products end up endangering the lives of many. It also shortens the life spans of motor vehicle engines and other equipment.
In a notice published in the media, KRA said it would close down facilities used in illegal operations and take to court the individuals operating such facilities.
KRA is working with other State agencies including the Energy Regulatory Commission (ERC) and the police to trace and shut down rogue operators.
“KRA, ERC, Nema and the Police... do hereby give notice of intent to make immediate enforcement of sanctions... of persons found diverting or siphoning export petroleum products in the local market, selling motor fuels adulterated with kerosene and spilling and discharging petroleum into the environment,” said the KRA statement.
“Such facilities have not been inspected or approved by any relevant government agencies and are therefore prone to endanger human life, environmental degradation, interfering with the quality of petroleum products, risk of destruction of third party property and unfair competition.”
Loss of revenue
It added that diversion of petroleum products meant for export into the local market resulted in loss of revenue to the Government.
ERC said monitoring of the petroleum market and sanctioning players guilty of diverting export products and adulteration have seen incidences go down.
“This is part of a fuel-quality monitoring campaign through which we want to ensure consumers get quality products and products meant for export are not dumped in the local market,” said Linus Gitonga, director of petroleum at ERC.
“The fact that criminals know we are monitoring has seen the number of dumping and adulteration incidences go down,” he said.
“We have in the past shut down service stations found with adulterated or export products and that has deterred others that would want to attempt.”
Other than adulteration of fuel, uncouth players also operate illegal gas refilling plants that also put households in danger.
Illegal cooking gas plants are also a pain to legitimate companies. They in addition to losing market share to the illegal players have also seen a rise in theft of gas cylinders.
This is as the illegal businesses look for equipment to package their products.
Inefficiencies in the fuel supply chain caused by an archaic infrastructure have in the past been said to be prone to manipulation.
