By Ebi Kesiena
Kenyan Members of Parliament have voted in favour of doubling of the value added tax (VAT) levied on fuel to 16%, which is expected to add to the rising cost of living.
Late Wednesday, ruling party coalition MPs pushed through the proposal with 184 approving the clause within the new finance bill, while 88 lawmakers opposed it.
The government, which is looking to raise about 50bn Kenyan shilling from the additional tax, has defended the move as necessary amid a rising debt burden.
But the leader of the opposition MPs in parliament said it was punitive, arguing that some of the measures are unconstitutional, also terming the decision to push ahead with the fuel tax clause as “the saddest day in the history of this country”.
This week, Kenya’s parliament has been combing through clauses within the unpopular finance bill and considering voting on amendments.
Besides the fuel tax, some of the controversial proposals include a housing fund levy to be paid by all salaried workers and an increase in taxes for social media influencers.
During a session that ran late into the night, lawmakers from Ruto’s ruling coalition defeated opposition attempts to strike out the fuel tax hike as well as a new 1.5% housing tax on employees that will be matched by employers.
The opposition says the housing levy will strain already squeezed incomes and raise business costs at a time when Kenyans are struggling with high prices for basic commodities.
While President Williams Ruto says it will fund the construction of homes for the poor, offering them dignity and creating jobs for young people.
The bill now moves to the President for signing.
