The Kenya Revenue Authority (KRA) and the Ministry of Petroleum and Mining are on the spot for taxing higher levies on diesel even though the same decision had been quashed by the parliament.
The Parliament had directed the ministry to revoke a notice announcing an increase of the levies from Kshs0.40 to Kshs5.40 in October last year. 11 months later, KRA is still charging a higher Petroleum Development Levy (PDL) according to the Business Daily.
From October 2021 to June 2022, KRA collected Kshs11.05 billion as PDL. The amount in the same period would have been Sh818.67 million if the rate would have remained at Kshs0.40.
The levy is believed to be one of the reasons behind the increased prices of petroleum and diesel. If the notice on high levies would have been revoked, the prices of diesel would now be standing at Kshs 136 instead of Kshs140.
Insiders at KRA however said that they continued charging high taxes because of a directive from the petroleum ministry. Failure of the ministry to gazette a new notice has as well left the taxman with a legal nightmare.
“The authority collects PDL as an agent of the Ministry of Petroleum and Mining in accordance with the Petroleum Development Fund Act and as provided in the various Legal Notices over time,” the sources told the publication.
The Ministry now risks being charged Kshs11 billion as a refund to motorists due to the exploitation.
The Energy and Petroleum Regulatory Authority (Epra) however revealed that they found another solution on the matter despite the failure to publish a new notice thus contravening the tax policy that dictates transparency in all taxes.
RELATED STORY:Nelson Havi Outwits EPRA By Opting For Different Mode Of Transport To Beat Hiked Fuel Prices
