IMF Wants Kenya To Double VAT On Petroleum Products

As Kenyans continue to wail, calling on the International Monetary Fund (IMF) not to give loans to the “corrupt Jubilee government,” IMF seems to be deaf and now planning to raid the already-mutilated Kenyan pockets with higher taxes.

Reports have emerged that the National Treasury is under pressure from the International Monetary Fund (IMF) to double the Value Added Tax (VAT) on all petroleum products in an effort to cut the budget deficit and tame public borrowing.

IMF says that Kenya should impose a 16 percent VAT on fuels from the current eight percent when crude oil prices fall, signaling the fund is open for a delayed implementation to guard against growing public anger and pressure over soaring petroleum costs in the country.

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The International Monetary Fund approved another loan of 255 billion shillings to Kenya in what it said should be used to help the economy recover from the Covid-19 pandemic and economic shockwaves. Kenyans took to social media to protest the move by IMF saying the cash was set to be looted.

If the push by IMF to double VAT on fuel products will be accepted by Kenya (it will be accepted in the end), then Kenyans will have no otherwise but to start paying for the highest prices in petrol, diesel, and kerosene in the region.

Mid-March, petrol prices increased by 6.6 percent to 122.8 shillings per liter, from 115.2 shillings per liter previously. Diesel prices increased by 5.6 percent to 107.7 shillings per liter, from 101.9 shillings per liter. Kerosene increased by 5.9 percent to 97.9 shillings per liter, from 92.4 per liter.

Those in Nairobi, a liter of Super Petrol will go for 122.81 shillings. Those consuming Diesel are parting with 107.66 shillings while Kerosene users will part with 97.85 shillings. With IMF push, Kenyans will pay through the nose.