Parliament to Consider Ndindi Nyoro’s Fuel Cost Reduction Proposals

Parliament has received a proposal by Ndindi Nyoro seeking changes to fuel taxes and levies that could reduce the price of diesel by up to Sh54 per litre.

In a communication from the Parliamentary Budget Office, the National Assembly confirmed receipt of Nyoro’s submission dated 15 May. The proposals have been referred to the Budget and Appropriations Committee and the Departmental Committee on Finance and National Planning for review of their financial impact on current and future budgets, as well as the Road Maintenance Levy Fund.

Nyoro’s proposals focus on three measures. He wants the Road Maintenance Levy Fund charge reduced from Sh25 to Sh18 per litre, reversing the increase introduced in 2024. He also proposes removing petroleum products from the VAT schedule, which would eliminate the current 8 percent tax on fuel. In addition, he is calling for stricter controls on profit margins for fuel importers and distributors, alongside a Sh5 billion subsidy for petrol.

“These amendments are short-term measures aimed at reducing the inflationary and sticky economic effects arising from the current high fuel prices,” Nyoro said in his letter to Parliament.

The proposals were submitted after the Energy and Petroleum Regulatory Authority announced higher fuel prices on 14 May. Diesel prices in Nairobi rose to Sh242.92 per litre, while petrol increased to Sh214.25.

The increases prompted a nationwide strike by matatu operators, taxi drivers, cargo transporters and boda boda riders. The disruption affected public transport, schools, businesses and supply chains across the country.

Energy CS Opiyo Wandayi and Transport CS Davis Chirchir held talks with transport operators and agreed to a Sh10.06 reduction in diesel prices. Operators initially rejected the offer and demanded cuts of between Sh30 and Sh35 per litre.

The dispute later eased after Interior CS Kipchumba Murkomen joined negotiations and helped secure a temporary agreement. Transport operators suspended the strike for seven days but warned they would resume industrial action if no further progress is made.

Treasury CS John Mbadi and Deputy President Kithure Kindiki defended the continued use of some fuel levies, saying the funds are needed for road projects and public services. Government officials attributed the rise in fuel prices to global instability, including the conflict involving the US, Israel and Iran, which they said has increased international fuel, freight and insurance costs.

Nyoro said his proposals are separate from negotiations with the transport sector and should be assessed independently. He added that rising fuel prices affect all Kenyans directly and indirectly and said he expects to appear before parliamentary committees in the coming week.