Kiharu MP Ndindi Nyoro calls for removal of fuel VAT and Sh7 levy

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Kiharu Member of Parliament Ndindi Nyoro has called on the government to remove the 8pc Value Added Tax (VAT) on fuel and scrap the additional Sh7 fuel levy introduced in 2024, saying the taxes are responsible for high fuel prices despite declining global oil prices.

Speaking during a press briefing on Tuesday, Ndindi Nyoro said global crude oil prices have significantly dropped since 2022 but the reduction has not been reflected in the prices paid by Kenyan consumers.

He noted that global oil prices averaged about $100 per barrel in March 2022 and peaked at $116 per barrel in May the same year, yet petrol in Kenya sold at around Sh150 per litre while diesel retailed at about Sh131.

Nyoro said even without subsidies at the time, petrol and diesel would have cost about Sh176 and Sh174 respectively at their peak.

“Even while global prices halved from the high of $116 per barrel in 2022 to below $55 per barrel by December 2025, Kenyans did not experience a similar drop at the pump,” he said.

The MP attributed the persistently high prices to the introduction of an additional 8pc VAT on fuel in 2023 and the Sh7 fuel levy introduced in 2024.

He noted that VAT alone accounts for more than Sh25 per litre of fuel, in addition to other excise taxes and levies.

Nyoro further claimed the government had already collected the Sh7 levy in advance through what he termed illegal securitisation, amounting to about Sh32 billion annually.

He urged the government to remove both the VAT and the Sh7 fuel levy to ease the burden on Kenyans and support the struggling economy.

The lawmaker also questioned why fuel prices in neighbouring countries remain lower despite relying on Kenyan infrastructure for supply.

“It is unfathomable that fuel is cheaper in Uganda yet their fuel passes through Kenya. In Tanzania petrol is below Sh155 and it is still cheaper in Rwanda,” he said.