New taxes push up the cost of living as July inflation hits 6.4pc

New taxes push up the cost of living as July inflation hits 6.4pc

Recently effected taxes have pushed up the cost of living further in July with inflation for the month coming in at 6.44 per cent from 6.32 per cent in June. The rise in the cost of basic consumer goods has been mainly reflected in the information and communication (ICT) index which rose by 1.81 per cent. This is as mobile phone airtime costs went up by 2.4 per cent during the month following a hike in excise duty to telephone and mobile data services from 15 to 20 per cent. The average cost of calls per minute now sits at Ksh.2.41 per minute from a lower Ksh.2.35 in June. At the same time, the housing, water, electricity and gas index has increased by 1.34 per cent attributed to increased cooking gas prices. LPG costs surged by 15.43 per cent on the back of the introduction of a 16 per cent VAT charge on the commodity on July 1. A 13-kilogram LPG cylinder is currently retailing at an average Ksh.2394.18 from a lower Ksh.2074.23 last month. Similarly, electricity prices shot up by 1.1 per cent over the same period. Nevertheless, food prices marked a rare cool down by half a percentage point in the period to put brakes on an even greater cost of living at the end of July. Tomato, white bread and sugar for instance registered price decreases of 4.1, 2.8 and 1.3 per cent respectively. However, the cost of sukumawiki, cabbages and cooking oil expanded further in the period dragging down the general effect of lower food prices. The cost of living in July is the highest this year and over the last 16 months since February 2020.

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