KRA denies increase of taxes on cooking gas

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Kenya Revenue Authority (KRA) on Friday denied an increase in taxes on Liquid Petroleum Gas (LPG).

Some media houses had reported that several LPG tracks got stuck at the Namanga One-Stop Border Post over new taxes and that it would see an increase in cooking gas prices.

Deputy Commissioner at KRA, Joseph Kaguru, told journalists in a press briefing in Nairobi that the report was misleading and not true.

Kaguru said there was no cause for alarm about the shortage of cooking gas in the country since the levies currently enforced by the taxman are in the form of Value Added Tax (VAT) which was introduced nine years ago.

“KRA would like to clarify that the information is not true and it’s unfortunate that some people are misleading the public. The VAT on LPG currently being enforced was introduced way back in 2013 but the government delayed implementation until July 2021. So this is not a new tax as it has been alluded to,” said Kaguri.

In a report by Citizen TV, importers of the commodity had accused  KRA of imposing the taxes without giving them any notice by increasing the levies from Ksh.70,294.9 to Ksh.108,059.

KRA, however, said the matter was a way of tax evasion by the traders and that the authority was only acting within its laws.

“So, it is very unfortunate when a few traders decide to break the border to push for their rights and the rights that cannot be given because the law cannot allow it. If it is right to pay raised taxes  that is not acceptable. We are not saying that these traders have not paid taxes. They have already paid taxes, unfortunately  they are not the taxes they should be paying under the law.”

The taxman dismissed the allegations of importing LPG from Tanzania through the Namanga border saying the gas is originating from the Middle East, “only passes through some importers from Tanzania.”

LPG dealers and suppliers in Kenya increased the commodity prices in March this year due to the shortage of global supply of the commodity as Russia continues her offense against Ukraine.

In Nairobi, Kenyans are now paying Ksh.1,560 to refill a 6kg gas cylinder from the lows of Ksh.1,441.  The 13kg is going for Ksh.3,340 from Ksh.3,113. The 35kg gas refill dealer price is Ksh.8,192.

Gas prices have been on an upward trajectory rise since early 2016 when the price of a 13kg cylinder shot to Ksh.2,000.

By October 2020, the price for refilling a 13kg cylinder went to Ksh.2,445 and in November 2021 it went to Ksh.2,513.

The price increase was initially caused by a reintroduction of a 16 percent VAT on LPG, which was scrapped in 2016.

An increase in gas prices adds to the inflation crisis and the rising food prices.

Kenya’s inflation rate jumped to 6.47 percent in April from the 5.56 percent in March, backed by the increase in fuel prices which were reviewed upwards.

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