Kithure Kindiki picks new fight with Jubilee

BY KEVIN KOECH

Petroleum PS Andrew Kamau on Sunday, August 2, revealed that the hike in fuel prices for the July 15 – August 14, period was a result of a calculation error.

“There was a miscalculation by EPRA when they had not included excise duty in computing the VAT and that had to be corrected in the latest pricing review.

“This has now been corrected and since it was not the oil marketers’ mistake, there was no way to go back and ask them for what they didn’t collect,” the PS said.

On July 15, the Energy and Petroleum Regulatory Authority (EPRA) announced new fuel prices which resulted in a huge spike compared to the previous 30-day period.

Petrol prices rose by Ksh11.38 to retail at Ksh100.48 per litre in Nairobi while a litre of diesel increased by Ksh17.3 to sell at Ksh91.87 in the capital.

According to PS Kamau, EPRA erronously calculated the latest prices resulting in the surge.

In a statement, EPRA highlighted the under-recovery of VAT in regards to Kerosene which was not imported during the month in review.

“Price has been maintained but adjusted for the under-recovery of value-added tax by oil marketing companies that occurred in the previous pricing cycle,” the statement reads in part.

However, the energy regulator maintained that the blame for the error lay squarely on oil marketing companies who misunderstood the taxation law.

EPRA director-general Pavel Oimeke stated that the companies did not adhere to Sections 13 and 14 of the VAT Act, 2013.

The marketers had reportedly included only the excise duty as part of the taxable value rather than all taxes, levies, duties and fees in line with Section 13(3)(c) of the VAT, 2013, and the Tax Laws (Amendment) Act, 2020.

According to the Kenya Revenue Authority (KRA), VAT computation for super petrol, diesel and kerosene at the import point differs from the one at the sales point.

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