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Tax squeeze hits Kenyans’ cooking gas
use as prices rise to two-year high

NAIROBI (Xinhua) -- The use of cooking gas in Kenya has taken a downward trend as prices hit an over two year high following the introduction of value added tax on fuel products, with the development putting a dent on the East African nation’s efforts to embrace the fuel.

The government slapped an 8 percent tax on fuel products namely kerosene, petrol and diesel as it sought to shore up its revenue. The taxes have had a ripple effect in the cooking gas sector, making dealers raise prices.

In the capital Nairobi, a survey on Wednesday indicated that dealers have raised the cost of cooking gas to an average of 2,200 shillings (about 21.5 U.S. dollars) for the 16kg cylinder. On the other hand, a 6kg cylinder is going for 9.8 dollars.

The last time the prices of the commodity were at the level was in June 2016, according to official data from the Kenya National Bureau of Statistics (KNBS).

Then, the government had removed tax on the fuel pushing the prices to below 19.5 dollars where they stayed since.

The current prices are reversing the gains Kenya had made in pushing citizens embrace the cleaner energy.

The latest consumption data from KNBS indicates that cooking gas use stood at 19,000 metric tonnes (MT) in September when the taxes were imposed, from an average of 22,000MT the previous months.

“Since the tax on petrol and diesel was imposed, demand has stagnated because our suppliers also increased prices. I used to sell up to 25  6kg and 13kg cylinders of cooking gas a month but now I only do 15 and it’s the same customers who keep on coming. Small income earners who used to buy the 6kg cylinder have disappeared,” said Abel Kirui, a cooking gas seller in Donholm, east of Nairobi.

Similarly, consumers have regulated the use of cooking gas with a majority supplementing its use with kerosene to avoid high costs.

“I use cooking gas only to make breakfast and supper, the rest of the meals I cook using kerosene,” said Rose Mutheri, an administrative assistant in Nairobi.

Use of kerosene, according to the KNBS data, also declined to 16,800MT in September from 24,980MT in August following the imposition of new taxes, an indication that more Kenyans are using biomass for cooking.



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