CS Murkomen Orders Increase In Fuel Levy By Ksh.7 For Road Maintenance
Transport CS Kipchumba Murkomen‘s proposal to increase the road maintenance levy charged on each litre of petrol or diesel at the pump could bring fuel prices back to around Ksh.200 per litre.
CS Murkomen argued for the review, claiming that there will be increased demand for road maintenance in the coming years, which the additional Ksh.7 could help to meet.
“We have increased the road maintenance levy by Ksh.7 to expand road maintenance and construction,” said Murkomen.
The Kenya Roads Board proposed in its strategic framework to raise the road maintenance levy, also known as the fuel levy, by Ksh.5 over five years, bringing it to Ksh.23 per litre of diesel and petrol.
CS Murkomen now makes the case for an earlier target, citing the gradual decline in global fuel prices.
A litre of petrol currently costs Ksh.192.84, while a litre of diesel costs slightly less than Ksh.179.
With an additional Ksh.7 fuel levy, a litre of petrol would cost Ksh.199.84. This means that fuel taxes would be 81% of the landed cost.
Diesel taxes would increase to 71% of the landed cost, bringing the retail price to Ksh.186 in Nairobi.
Currently, Ksh.15 of the Ksh.18 collected from the fuel levy is used for road maintenance, rehabilitation, and development. The government expected to collect up to Ksh.88 billion this year from the levy.
The country has a road network of over 239,000 kilometres, with only 11% tarmacked and the remainder gravel or earth roads.
According to CS Murkomen, the need for road maintenance has more than doubled in recent years.
He estimates that the country will need Ksh.786 billion to maintain its roads over the next five years, compared to Ksh.471 billion in budgeted resources.
This will result in a Ksh.315 billion deficit, with thousands of kilometers of roads going unmaintained.
Murkomen’s proposals come at a time when motorists and vehicle owners have objected to proposals in the Finance Bill, including a 2.5% motor vehicle tax, which the Finance and Planning Committee estimates will earn the government up to Ksh.58 billion.
According to budget provisions approved by the National Assembly, Ksh.199 billion is proposed for the roads department, with Ksh.127 billion going to finance capital expenditure.
For CS Murkomen, this is insufficient to address the country’s needs.
CS Murkomen Orders Increase In Fuel Levy By Ksh.7 For Road Maintenance
