Epra sued for hiking road maintenance levy by Sh7

A new battle against the Kenya Kwanza government's move to increase the road maintenance levy has landed in court.

Energy and Petroleum Regulatory Authority (EPRA) and the Ministry of Transport have been sued for increasing the Road Maintenance Levy (RML) from Sh18 to Sh25 per litre of fuel consumed by motor vehicles.

Commission for Human Rights and Justice (CHRJ) in its case argued that the new levy was introduced without public participation.

It argued that there is a grave danger in the government introducing taxes without the involvement of Kenyans.

It raised questions about whether Parliament passed the levy.

According to the human rights body, the Transport Cabinet Secretary had publicly said the government had rescinded its decision to increase the levy following a public uproar.

"The respondents disregarded and failed to adequately incorporate the feedback received from the members of the public during the consultation period to the extent that the 1st Respondent negated the unequivocal promises he made to the public on the topic of increment of the Road Maintenance Levy (RML) just less than a month before," CHRJ's executive director Julius Ogogoh argued.

The levy has nearly tripled over the last 15 years from Sh9 per litre in 2009 to Sh12 in 2012 and Sh18 in 2016.

Among the factors that the ministry cited for its proposals to hike the levy include a 50 per cent increase in the cost of road maintenance since 2016, an expanded road network, and a lack of funding for the maintenance of roads assigned to the Kenya Rural Roads Authority (Kerra).

Hiking the road levy was initially recommended as a trade-off for dropping the 2.5 percent motor vehicle tax that had been proposed in the Finance Bill 2024.

In proposing a higher levy, the Kenya Roads Board - which administers it - had noted that the current collections at Sh84 billion per year are not adequate to meet annual road maintenance requirements at Sh150 billion.

"RMLF collections at the current rate of Sh18 per litre has stagnated at Sh80 billion per year. However, the road network has deteriorated over the years due to aging, orphaned road networks, increased urbanisation, traffic, and the effects of climate change.

The macroeconomic factors such as inflation and devaluation of the Kenya shilling have also continued to pile pressure on the funds for road maintenance. These factors have resulted in a maintenance backlog of Sh724 billion," said KRB when it made a case for the increase of the levy, adding that it will be seeking further increases in the levy.

"Based on the annual maintenance requirement of Sh157 billion, the ideal fuel levy rate ought to be set at Sh34 per litre. However, due to the prevailing economic conditions, a phased approach is proposed starting with an increase from Sh18 to Sh28."

In court, CHRJ stated that Kenya Kwanza's move is against its promise that the levy would not be increased unless and until there are austerity measures put in place.

Meanwhile, motorists have demanded an audit and accountability of the Road Maintenance Levy Fund.The Motorists Association of Kenya (MAK) requests detailed records from the government regarding road maintenance projects and their associated costs.

They demand data that covers the 2023/2024 and 2024/2025 financial years.According to MAK, the fund was established under the Road Maintenance Levy Fund Act of 1993, which was implemented recently despite the withdrawal of the Finance Bill 2024.Additional reporting by Harrison Ngola