A removal of fuel subsidy has sent petrol and electricity prices to the roof as the country's tax authority hikes excise taxes in an inflation adjustment plan.
For many Kenyans, life was unbearable during former president Uhuru Kenyatta’s reign. But just one day after new president William Ruto’s inauguration, life is getting more onerous, after the lifting of a fuel subsidy that had kept the price of petrol, diesel and kerosene the lowest in eastern Africa.
“On fuel subsidy alone, taxpayers have spent a total of $1.2 billion [since 2020],” Ruto said during his inauguration before projecting that if it continues till June next year, it will cost Kenyans $2.4 billion. To cushion manufacturers and processors against high production costs, the government has spent $74 million in fuel subsidies since April last year.
The move is seen as Ruto bowing to pressure from the International Monetary Fund, which in July set a new condition for the Kenyan government, requiring a removal of the fuel subsidy by October under a 38-month $2.34 billion loan.
Motorists could be seen queuing at petrol stations in Nairobi on the night of Sept.14, scrambling to fuel their cars before new prices take effect on Sept. 15 and last till Oct. 15.
The Energy and Petroleum Regulatory Authority (Epra) has raised the price of petrol, diesel and kerosene by 12.7%, 17.8%, and 16.4% respectively.
Epra has also increased the cost of electricity by 15.7%. Industrial power consumers will now pay even more as the pass-through costs now account for more than a third of power bills.https://twitter.com/johnallannamu/status/1570104951094890500?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1570104951094890500%7Ctwgr%5E4d6d99db11dfbb6a8571e12fab91aab514e83fb9%7Ctwcon%5Es1_c10&ref_url=https%3A%2F%2Fqz.com%2Fembed%2Finset%2Fiframe%3Fid%3Dtwitter-1570104951094890500autosize%3D1
