Why the pain at the pump may get worse for consumers
By Patrick Alushula | July 14th 2016
The decision by Government to reintroduce excise duty on kerosene and increase road maintenance levy may have deep implications on consumers’ budget.
In the wake of stabilising global oil prices, motorists and households will have to dig deeper into their pockets to afford petrol and kerosene.
While justifying the decision, National Treasury CS Henry Rotich said that absence of tax on kerosene has led to adulteration, a practice where some rogue oil companies mix kerosene with other commodities such as petrol to make unfair profits.
“This has denied the oil marketers business in the neighbouring countries in addition to giving them a bad reputation. In addition, adulteration negatively impacts car engines and increases their maintenance costs,” said Rotich in his budget statement last week.
To rectify this evil, Rotich did the reverse of what his boss Uhuru Kenyatta did in 2010 when he was the Finance Minister.
“In order to discourage this harmful practice, I propose to introduce excise duty on kerosene at Sh7, 205 per 1000 litres,” said Rotich.
That means that for every litre, consumers will be giving government Sh7.21.
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