The Energy and Petroleum Regulatory Authority, EPRA, on Sunday night announced that Kenyans will now be charged a road maintenance levy of Ksh25 per litre.
This was despite an earlier promise by former Transport Cabinet Secretary Kipchumba Murkomen that the government would explore other ways that would not risk Kenyans paying more at the pump.
Initially, the levy was set at Ksh18 per litre but Kenya Roads Board, KRB, proposed a 39 per cent increase.
The KRB said the Kenyan Government had not revised the road maintenance levy since 2016 which had caused a ksh727 billion road maintenance backlog.
With the new rates, EPRA will collect Ksh115 billion per year which will be used to repair existing roads.
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Even with the 39 per cent increase, KRB, noted that it was not enough to clear the backlog and as such, the amount levy will be revised up again in 2027.
“Given the inelasticity of demand for petroleum products in Kenya, it is expected that annual consumption will be maintained at 5.2 billion litres,” KRB had justified that the increase in levy would not lead to a drop in fuel consumption.
Additionally, the KRB termed petroleum products as luxury arguing that an increase in the levy would not raise the cost of living for Kenyans.
“Focussing exclusively on direct effects, the conclusion is that price changes induced by an increase in fuel levy will affect the rich more than the poor,” KRB rationalized.
In his last days in office, Murkomen had warned Kenyans that should EPRA not impose the levy, most roads constructed in the last decade would go into ruins.
He explained that contractors were mandated to maintain a road for three years and then shift the responsibility to the national government.
The former CS said it was unreasonable for the government to spend billions of shillings constructing roads and fail to maintain them.
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