Speaking to journalists in his office on Wednesday, Rotich said businessmen should share the cost with the customers to ensure that the prices remain stable.
He however says the increased prices will stabilize in the near future adding that Kenyans may stop buying the commodities in large numbers hence reduce demand.
“The adjustment in prices will be one off; it’s not something that will be happening every day. But our business people should not raise these prices beyond the prices which are expected. That will be wrong,” Rotich said, “If this cost is shared, the prices should be stable.”
The most affected commodity which has raised concerns among Kenyans is the price of milk which has gone up from Sh45 half a litre to around Sh65.
“Of course we expected the 16 percent VAT to be felt immediately on some of these key commodities, but as we move on, things will stabilize,” Rotich noted.
He defended the government for targeting the key commodities with the new VAT law, adding that the law has more benefits than ‘oppressing Kenyans.’
“Despite targeting to raise revenue, we also aimed at reducing the bureaucracies in terms of VAT refunds issues. We now expect the Kenya Revenue Authority to work efficiently,” Rotich said.
However the International Monitory Fund (IMF) is optimistic that Kenya’s inflation will remain at single digit due to what it terms as increased economic activities in the country.
“Inflation outlook looking forward is relatively benign. This means that it will be possible to accommodate a one off short term increase in prices. So outlook is positive,” Antoinette Sayeh, Director of the IMF’s African Department said.
The two were speaking while announcing a two-day conference starting September 17 in Nairobi, aimed at discussing the country’s economic success prospects and challenges.
The conference will be co-hosted by the Kenyan government and the IMF.