Africa-Press – Kenya. Members of Parliament on Wednesday voted to pass the proposed 16 per cent VAT on fuel. Some 184 MPs voted to increase the VAT from 8 per cent to 16 per cent, while 88 voted against it.
“We have the results on the division that clause 28 be part of the bill. 272 Members of Parliament took their vote.” Earlier, before the voting, a heated debate was witnessed , with both sides of the divide submitting their thoughts on the clause.
Minority Leader Opiyo Wandayi rose to oppose the increase saying if the clause becomes part of the Bill, it will be the saddest day in the history of the country.
“We all know that fuel is the driver of our economy. If there is one thing this government should have done to the hustler is cushion them from an increment on the prices of fuel,” he said. Majority Leader Kimani Ichung’wah said the VAT on fuel in Kenya is the lowest within the region.
“Our country is the market leader, with the strongest economy, but has the lowest VAT on fuel at 16 per cent, Uganda is at 18 per cent, our friends in Tanzania and Rwanda are still at 18 per cent,” he said.
In May, President William Ruto had defended his decision to increase the VAT on petroleum products to 16 per cent, saying he intends to raise Sh50 billion from the enhanced VAT on petroleum products.
“The 8 per cent will give us Sh50 billion to deal with roads across the country,” he said during an interview. Ruto said the move is important to seal loopholes being exploited by businessmen to deny the country the much-needed revenue.
“Because of the differential rates, that poses a problem on integrity, it was used by people as a loophole to manipulate numbers, the advise I got was that we must eliminate this loophole people are exploiting,” he said.
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