Kiharu Member of Parliament Ndindi Nyoro has outlined a set of proposals aimed at lowering fuel prices, warning that the current cost of petroleum products is straining households and could worsen economic pressure if no urgent action is taken.
In a statement issued on Friday, May 15, Nyoro said the sharp rise in fuel prices risks pushing inflation higher and deepening the cost-of-living burden, urging policy shifts to prevent further economic strain.
He faulted the existing fuel pricing model, arguing that repeated adjustments have not delivered meaningful relief to consumers.
"The drastic rise in fuel prices to Sh214.25 for Petrol and 242.92 for Diesel is unacceptable and will grossly hurt the economy now, in the medium and long term. Inflation is expected to rise drastically in the month of May going forward if we do not change course," he said.
Nyoro further questioned the impact of previous tax changes, especially adjustments on Value Added Tax, saying they have not translated into lower pump prices.
"The reduction in the percentage of VAT has not done much to reduce pump prices. This is due to the fact that VAT is calculated as a percentage of the landed cost, which has escalated," he added.
He also accused the government of using fuel price announcements in a way that does not reflect real relief to consumers.
"It is not acceptable that the government has been playing with fuel prices for political gains, purporting to give further direction after price guidance by EPRA. Policymakers need to understand that the announcement of "reduction" of variables after the gazetting of prices still leaves resultant costs high," h3 continued.
Nyoro added that fuel price increases tend to stick in the economy through transport and commodity costs, even when prices later drop.
"Most price hikes are sticky and therefore may not correspond with any reduction. Case in point is the transport cost. When fares go up, they become sticky, and therefore Kenyans are left paying high prices. What happened last Month is unfortunate," he further said.
In his proposal, Nyoro suggested several measures including reducing importers’ and distributors’ margins by Sh4 per litre, introducing an additional Sh5 billion diesel subsidy, scrapping Value Added Tax on petroleum products, and cutting the fuel levy introduced in 2024 by Sh7.
He noted that under the current structure, Super Petrol is priced at Sh214.25 per litre while Diesel stands at Sh242.92 per litre, but said the proposed changes would lower prices to Sh187.38 for Petrol and Sh189.16 for Diesel.
He added that diesel subsidy support would increase from Sh14.51 per litre to Sh24.75 per litre following the proposed Sh5 billion allocation.
Nyoro also proposed removing VAT charges currently amounting to Sh15.87 on Petrol and Sh17.99 on Diesel, alongside a reduction of Sh7 in the fuel levy.
He said he would move to Parliament to begin the process of amending laws to implement the proposals.
In a letter addressed to the Clerk of the National Assembly, Samuel Njoroge, he said he had already initiated formal steps to introduce the amendments.
"Pursuant to the provisions of the Constitution of Kenya, the Standing Orders of the National Assembly, and the relevant laws governing public finance and taxation, I hereby give formal notice of my intention to initiate legislative amendments aimed at reducing the retail prices of super petrol, diesel and kerosene in Kenya," he stated.
He further proposed changes to the Road Maintenance Levy Fund, calling for a Sh7 reduction in the current charge through a repeal of the Road Maintenance Levy Fund (Imposition of Levy) Order, 2024.
"The current levy of Sh 25 per litre shall be reduced by ksh 7 that was added in 2024 thereby reducing it from the current ksh 25 to Sh 18 per litre," he added.
Nyoro also wants amendments to the VAT Act to move petroleum products into the exempt category.
"This is to delete Section 5 subsection 2A of VAT Act Cap 476 thereby moving Petroleum products to the First Schedule of VAT Act as exempt supplies. This will effectively reduce the VAT from the current 8 percent to 0% (tax exempt) on petroleum products," he further said.