Nyoro Flags Fuel Taxes as Key Driver of High Prices, Calls for Temporary Relief Measures

Fuel prices in Kenya have once again become a focal point of national economic debate, with renewed pressure mounting on policymakers to cushion households from rising transport and commodity costs.

Kiharu Mp Hon Ndindi Nyoro has intensified calls for a short-term reduction in fuel taxes and levies, arguing that government policy has a significant influence on retail pump prices despite global oil market pressures.

Addressing a Parliament committee, Nyoro said Kenya’s exposure to international oil price fluctuations is unavoidable, but insisted that domestic tax structures have amplified the burden on consumers. He warned that continued high fuel costs are likely to sustain inflationary pressure, already projected to exceed 7.5 percent.

He pointed out that fuel pricing in Kenya is heavily shaped by statutory charges, arguing that this creates an opportunity for targeted fiscal intervention during periods of global volatility.

Nyoro outlined a six-month relief framework that includes cutting oil marketing margins by KSh4 per litre, temporarily removing VAT on petroleum products, reducing the Road Maintenance Levy, and boosting allocations from the Fuel Stabilization Fund to offset diesel costs.

He estimated the combined fiscal impact of the measures at approximately KSh48 billion, describing it as a controlled intervention aimed at stabilizing prices rather than a permanent tax shift.

The proposal has drawn attention to Kenya’s fuel pricing structure, with renewed scrutiny on how taxes, levies, and regulatory charges influence the cost of transport and goods across the economy.

Nyoro maintained that temporary adjustments are justified, noting that Kenya has previously operated under lower fuel taxation levels during periods of economic stress.