Kenyans are set to pay more for cooking gas after the Government raised taxes on imported liquefied petroleum gas (LPG) by more than Sh38,000.
The rise in cooking gas prices is largely attributed to the reintroduction of a 16 per cent Value Added Tax (VAT).
The government reinstated the 16 per cent VAT through Finance Act, 2020, which President Uhuru Kenyatta signed on June 30, 2020.
According to importers, KRA increased the levies from Sh70,000 to Sh108,000 per tonne of LPG, a charge they said they would pass on to consumers.
Trucks importing the precious commodity from Tanzania where its cheaper have been stuck at the Namanga border over failure to pay the new taxes.
The soaring LPG prices could force a resurgence in the use of electricity for cooking.
Domestic demand for electricity increased by 8.7 per cent to 9,565.4GWh in 2021 mainly due to decreased tariff costs compared to previous years.
Kenyans are also increasingly turning to charcoal and kerosene amid the rising cost of cooking gas.
The demand for LPG nearly doubled in the last four years despite the annual price increases to highlight how households have defied tough economic times to tap clean energy.
Data from Kenya National Bureau of Statistics (KNBS) shows net imports for cooking gas increased from 189.3 tonnes in 2017 to 371.4 tonnes in 2021, a 50.9 per cent surge even as the sector remains hugely unregulated and monopolised.
“This implies sustained use of LPG following continued government policy to promote the use of clean energy,” the statistics office said in the Economic Survey 2022 report.
Unlike Diesel, fuel, and Kerosene, LPG prices are not controlled by the Energy and Petroleum Regulatory Authority (EPRA), giving room for an uncontrolled hike in cooking gas prices.
Refilling 13-kilogramme gas averages at Sh2,866, 38 per cent jump from Sh2,074 a year back, according to KNBS data.