Sakaja proposes fuel tax cap to keep pump prices below Ksh.200

Speaking on Hot 96 on the issue of fuel prices, Sakaja argued that the Energy ministry should develop a flexible pricing formula that balances revenue collection with the need to cushion Kenyans against high fuel costs.

“If we sit down and think critically, we can find a solution,” Sakaja said.

The Governor proposed that taxes should only be applied when fuel prices remain at or below KSh 200 per litre. Under his proposal, taxes would automatically be suspended if rising international fuel costs push prices beyond that threshold.

“We can introduce price capping where taxes on fuel only apply when pump prices are KSh 200 and below. If prices rise above that level, the taxes would be suspended,” he said.

Sakaja noted that government intervention should focus on ensuring that the combined impact of fuel landing costs and taxation does not result in unaffordable prices for consumers.

“Our role as government is to create a formula ensuring that the landing cost of fuel, together with taxes, does not push pump prices beyond KSh 200,” he stated.

He further explained that where fuel import costs are low enough, taxes could continue to apply without affecting consumers. However, he maintained that taxation should be relaxed whenever costs rise sharply.

“If higher landing costs combined with taxes would push fuel prices above KSh 200, the taxes should be suspended to cushion wananchi. That is my suggestion on the fuel issue,” Sakaja added.

The proposal comes amid continued public concern over the cost of fuel and its ripple effects on transport, food prices and the broader cost of living, with many Kenyans calling for measures to ease the burden on households and businesses.