MPs approve road levy increase but say fuel prices remain unchanged
By Lucy Mumbi |
Roads PS Joseph Mbugua explained that the current levy of Sh18 per litre of petrol and diesel has remained unchanged since 2016.
Members of Parliament have given the nod to the Road Maintenance Levy Fund (Imposition of Levy) Order, 2024, which proposes raising the levy on petrol and diesel from Sh18 to Sh25 per litre.
The Committee on Delegated Legislation, chaired by Ainabkoi MP Samuel Chepkong’a, had scrutinised the legal notice, warning that it would be rejected if it led to an increase in fuel costs.
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The key legal notice was, however, endorsed after assurances from the State Department of Roads, led by Principal Secretary Joseph Mbugua.
Mbugua said the approval will not result in higher fuel prices, as the government has assured that the increase in the levy will not affect the current pump prices.
"Considering the tough economic times, it will be inconsiderate of us to approve an order that will see a hike in the price of fuel,” Chepkong’a said.
Vice-chair of the committee, Robert Gichimu, had also raised similar concerns, emphasising that raising fuel prices would lead to a spike in food prices and overall living costs, which is undesirable in the current economic difficulties.
In response to the committee's concerns, Mbugua confirmed that the proposed increase in fuel levy would not raise fuel prices.
“We are confirming to Kenyans that there will be no increase in the price of fuel. We have measures in place to increase the levy without increasing the cost of fuel beyond the current prices,” he assured.
Mbugua was accompanied by several director-generals, including Rashid Mohamed (Kenya Roads Board), Silas Kinoti (Kenya Urban Roads Authority), Kung’u Ndung’u (Kenya National Highways Authority), and Philemon Kandie (Kenya Rural Roads Authority).
Mbugua explained that the current levy of Sh18 per litre of petrol and diesel has remained unchanged since 2016, despite the growth of the road network and changes in the economic environment.
He stated that the amount collected from the levy has stagnated at Sh80 billion per year, which is insufficient for road rehabilitation across the country.
“The road network has grown from 161,451 km in 2016 to 239,122 km in 2024, and the economy has evolved. However, the levy has not been adjusted to reflect these changes. That is why we are seeking an upward revision,” Mbugua said.
While some stakeholders have raised concerns about the potential negative effects of the increase, including the breach of constitutional principles and a possible rise in the cost of living, the Ministry of Transport has argued that the higher levy is necessary to support road maintenance.
With the proposed rate of Sh25 per litre, the government anticipates annual collections to rise from Sh80 billion to Sh115 billion, which will be used for road network upkeep.
The ministry also pointed out that inflation and the depreciation of the Kenyan shilling have led to higher costs for construction materials, many of which are imported.
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