Kenya’s boda boda operators are struggling as a result of the increase in fuel prices, despite a court ruling that temporarily prevents the Finance Act 2023 from taking effect.
The Energy Petroleum Regulatory Authority had to raise the price of Super Petrol, Diesel, and Kerosene as a result of the Finance Act’s introduction of a tax rate of 16% on fuel products from the previous 8%.
In order to reflect the changes in pump costs, Boda Boda operators have threatened to increase charges by 30%. They applied pressure to the Boda Boda online application businesses on Sunday, threatening a go-slow if they didn’t modify the fare costs on their platforms.
On Sunday, the National Online Boda Boda Transport Network organization gave operators 48 hours to take action to keep their businesses afloat in the face of increased living costs.
“For every trip we currently make, 90 per cent earning goes on petrol, the remaining ten per cent is not enough to cater for maintenance of the motorbikes and food for our families,” said one of the boda boda riders.
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The riders claim that the decision was made as a result of the recent increase in fuel prices following the passage of the controversial Finance Act. The Energy, Petroleum and Regulatory Authority (EPRA) has amended the VAT on Super Petrol, Diesel, and Kerosene from 8% to 16% with effect from July 1st, 2023, in accordance with the Finance Act 2023.
The Finance Act, which also includes new or increased taxes on salaries, housing levies, mobile money transfers, food, and petrol among other services, was temporarily suspended by a court order, but EPRA disobeyed it. On Monday, Chief Justice Martha Koome was presented with the case that Busia Senator Okiya Omtatah had filed at the High Court.
Following in the footsteps of Matatu owners who announced last week that public service vehicles will increase fees by 30%, the Boda Boda operators’ proposal to increase prices by 30% will increase costs by 30%.
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Town services in all of Kenya are anticipated to have a fare increase of between Sh10 and Sh50, but long-distance route travel is anticipated to see an increase of between Sh100 and Sh300.
