Spare a thought for the poor hurt by fuel prices
Although Kenya’s economy is said to have grown significantly compared to the same period last year, all indications are that the poor are not benefiting from this.
On the contrary, although the country’s middle class is expanding, the poor are growing poorer by the day.
Central Bank of Kenya’s report that overall energy inflation has doubled, hitting an all-time high of 37.9 per cent by June 2018 from 8.8 per cent in February, should therefore make millions of Kenyans out there worried.
A sharp rise in fuel inflation has see the prices of kerosene and charcoal — used by majority of poor households in the countryside — hit the roof.
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When Treasury announced new VAT taxes on all petroleum products that saw the price of kerosene rise by 20 per cent, the argument was that this would raise more revenue. Treasury also slapped a Sh18 per litre levy on kerosene, further compounding the woes of poor Kenyans.
But months after the petroleum levies came into force, it is clear that the they have not boosted the country’s revenue, but are instead hurting poor Kenyans.
Early this week, Kenya Revenue Authority announced that it was revising its revenue target downwards. This vindicates critics of the petroleum levies last year who argued that the economy simply did not have any more money to be taxed.
If this is the case then, we must find a way of easing the pain of poor Kenyans who still rely on kerosene and charcoal for fuel. Revisiting the petroleum levies would be a good place to start.
Central Bank of KenyaKenyaRevenue AuthorityFuel price