Manufacturers oppose rise in tax on fuel products

June 12, 2015
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Haco Tiger Brands Managing Director Peter Kang'ethe says the increase in fuel will raise transportation costs to manufacturers which will then be added onto the consumer. Photo/ MUTHONI NJUKI
Haco Tiger Brands Managing Director Peter Kang’ethe says the increase in fuel will raise transportation costs to manufacturers which will then be added onto the consumer. Photo/ MUTHONI NJUKI

, NAIROBI, Kenya, Jun 12 – Manufacturers have raised concerns over increased tax on fuel products pointing out that it will lead to a rise in consumer goods prices in the country. Haco Tiger Brands Managing Director Peter Kang’ethe says the increase in fuel will raise transportation costs to manufacturers which will then be added onto the consumer.

Treasury Cabinet Secretary Henry Rotich increased the road maintenance levy by Sh3 per litre of petrol and diesel that will be paid in the Road Annuity Fund.

“When transport goes up it has a ripple effect then that will affect the transportation costs, propensity for our consumers because they will be paying more for transport services,” he said.

Kang’ethe was speaking during the BIC back-to-school promotion rewarding ceremony where top five of the 403 countrywide winners were rewarded.

“However I am happy that there was an increase in allocation to security because that again is key concern not only to manufactures but even to our consumers but especially to the foreign direct investment,” Kang’ethe added.

The government will allocate Sh223.9 billion to the security sector during the 2015-2016 financial year, a Sh27 billion increase from the previous allocation.

The Motorists Association of Kenya also opposed the tax increase pointing out that the increase is ill-advised and travesty to new constitution.

“The Ministry of Transport and Infrastructure has nothing to show on road maintenance with the massive funds at their disposal, Motorists are only a section of the society but roads are for the whole society, it’s unfair to burden us with road maintenance, Let all Kenyans maintain our roads,” said the Association’s Chairman Peter Murima.

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