Road maintenance tax sparks outrage among motorists

Kenyans are facing a potential transport crisis as sector players have sent the government a seven-day strike notice. The warning comes amid growing tension over the controversial road maintenance levy.

This could affect almost all Nairobians, as 8 out of 10 people travel to work using public transport vehicles every day.

On Friday, July 19, the Motorists Association of Kenya (MAK) expressed its displeasure with the government’s decision to increase the road maintenance and fuel levy from Sh18 to Sh25 per litre.

The association condemned the increase as illegal and called for its immediate repeal, demanding structural reforms to improve transparency and accountability in the sector.

The Energy and Petroleum Regulatory Authority (EPRA) this week announced a Ksh7 increase in the tax, a move that has sparked widespread criticism.

The MAK claims that this adjustment constitutes a direct infringement on taxpayers, resulting in an additional daily income of 140 million shillings for the government, which it calls an “illegal tax”.

MAK Chairman Peter Murima vehemently opposed the increase, stating: “We, the undersigned, reject the illegal increase in road maintenance tax.”

Murima noted that the daily revenue of Sh140 million, multiplied by the 20 million litres of diesel and petrol consumed daily, underscores the financial burden placed on motorists.

Murima’s statement was blunt: “We are giving the government seven days to rescind the increase or face a strike.” The threat of a nationwide strike looms large and could disrupt transport services across Kenya.

The controversial tax was published in the Official Gazette on July 10, 2024 by former Secretary of the Transport Cabinet, Kipchumba Murkomen.

The decision came a day after Murkomen promised that the government would address public concerns raised during the consultation period.

Murkomen defended the rate hike as a necessary measure to generate an additional Sh32 billion in revenue, crucial to addressing the projected Sh315 billion maintenance gap between 2023 and 2027.

The tax structure now includes several components: excise duty (Ksh 21), road maintenance tax (Ksh 25), import declaration tax (Ksh 26.05), petroleum development tax (Ksh 5.40), petroleum regulatory tax (Ksh 0.75), railway development tax (Ksh 1.33) and value added tax (Ksh 26.05). The total annual collection from these levies amounts to Ksh 83 billion.