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Petrol prices down, diesel edges up in ERC review

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A petrol station in Nairobi
A petrol station in Nairobi. FILE PHOTO | NMG 

Nairobi motorists will have a Sh2.21- relief on a litre of petrol at in the latest price revisions by the Energy Regulatory Commission.

ERC also announced a Sh0.39 and Sh0.29 increase in the price of a litre of Diesel and Kerosene respectively in the revisions that also included the 16 per cent Value Added Tax.

Director General Pavel Oimeke was however keen to point out the possibility of further revisions on the tax that has been a subject of debate including an intervention by President Uhuru Kenyatta who yesterday proposed that it be halved.

“The prices are inclusive of Value Added Tax at 16 per cent in line with the provisions of the VAT Act 2013. Nevertheless, the commission shall publish new prices whenever the rate of VAT is varied by law, “Mr Oimeke wrote in the price revision notice.

Nairobi motorists will now purchase a litre of petrol at Sh125.59, diesel at Sh115.47 and Kerosene at 97.70.

ERC gives monthly price revisions considering the weighted average cost of imported refined petroleum products, with the landed cost of petrol said to have dropped 2.33 per cent while that of diesel climbed 0.40 per cent in the month of August.

Kerosene price per litre was however increased despite a 0.60 per cent drop on its landed cost, perhaps to tame adulteration of fuel for which crooked businessmen use it to increase margins.

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Before the VAT was loaded on 1st September, super petrol was retailing at Sh113.73 while diesel which is also used in heavy machinery and power generation was retailing at Sh102.74 per litre in Nairobi.

The marginal fall in petrol prices may come a relief to motorists who were already overburdened by the heavy taxes on fuel and ERC’s announcement may quell jitters even as parliament resumes next week to consider the proposal by president Kenyatta to cut the VAT to 16 per cent amidst public outcry

A higher revision of the petroleum product prices could have worsened the uproar.

Petrol, Diesel and Kerosene have carry a heavy load of levies and taxes raising hundreds of billions for the government in revenues. Over Sh60 billion was raised from the consumption of these three products in the first six months of 2016 alone according to the official data for example.

The levies include, road maintenance levy (Sh18 per litre on both diesel and petrol), petroleum development levy (Sh0.40 per litre on all the three), petroleum regulatory levy (Sh0.05 per litre on kerosene and Sh0.12 per litre on petrol and diesel) as well as railway development levy Sh0.50, Sh0.52 and Sh0.51 on every litre of petrol, diesel and Kerosene respectively.

With another 16 per cent VAT added on a litre of all the products, the burden is heavier.

High fuel costs affect transport which is the third weightiest factor after food and Housing, water and electricity in measuring inflation according to the Kenya national Bureau of Statistics which put August inflation at 4.04 per cent, favorably low compared to July’s 4.35 per cent.


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World Bank pushes G-20 to extend debt relief to 2021

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World Bank Group President David Malpass has urged the Group of 20 rich countries to extend the time frame of the Debt Service Suspension Initiative(DSSI) through the end of 2021, calling it one of the key factors in strengthening global recovery.

“I urge you to extend the time frame of the DSSI through the end of 2021 and commit to giving the initiative as broad a scope as possible,” said Malpass.

He made these remarks at last week’s virtual G20 Finance Ministers and Central Bank Governors Meeting.

The World Bank Chief said the COVID-19 pandemic has triggered the deepest global recession in decades and what may turn out to be one of the most unequal in terms of impact.

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People in developing countries are particularly hard hit by capital outflows, declines in remittances, the collapse of informal labor markets, and social safety nets that are much less robust than in the advanced economies.

For the poorest countries, poverty is rising rapidly, median incomes are falling and growth is deeply negative.

Debt burdens, already unsustainable for many countries, are rising to crisis levels.

“The situation in developing countries is increasingly desperate. Time is short. We need to take action quickly on debt suspension, debt reduction, debt resolution mechanisms and debt transparency,” said Malpass.

ALSO READ:Global Economy Plunges into Worst Recession – World Bank

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Kenya’s Central Bank Drafts New Laws to Regulate Non-Bank Digital Loans

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The Central Bank of Kenya (CBK) will regulate interest rates charged on mobile loans by digital lending platforms if amendments on the Central bank of Kenya Act pass to law. The amendments will require digital lenders to seek approval from CBK before launching new products or changing interest rates on loans among other charges, just like commercial banks.

“The principal objective of this bill is to amend the Central bank of Kenya Act to regulate the conduct of providers of digital financial products and services,” reads a notice on the bill. “CBK will have an obligation of ensuring that there is fair and non-discriminatory marketplace access to credit.”

According to Business Daily, the legislation will also enable the Central Bank to monitor non-performing loans, capping the limit at not twice the amount of the defaulted loan while protecting consumers from predatory lending by digital loan platforms.

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Tighter Reins on Platforms for Mobile Loans

The legislation will boost efforts to protect customers, building upon a previous gazette notice that blocked lenders from blacklisting non-performing loans below Ksh 1000. The CBK also withdrew submissions of unregulated mobile loan platforms into Credit Reference Bureau. The withdrawal came after complaints of misuse over data in the Credit Information Sharing (CIS) System available for lenders.

Last year, Kenya had over 49 platforms providing mobile loans, taking advantage of regulation gaps to charge obscene rates as high as 150% a year. While most platforms allow borrowers to prepay within a month, creditors still pay the full amount plus interest.

Amendments in the CBK Act will help shield consumers from high-interest rates as well as offer transparency on terms of digital loans.

SEE ALSO: Central Bank Unveils Measures to Tame Unregulated Digital Lenders

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Scope Markets Kenya customers to have instant access to global financial markets

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NAIROBI, Kenya, Jul 20 – Clients trading through the Scope Markets Kenya trading platform will get instant access to global financial markets and wider investment options. 

This follows the launch of a new Scope Markets app, available on both the Google PlayStore and IOS Apple Store.

The Scope Markets app offers clients over 500 investment opportunities across global financial markets.

The Scope Markets app has a brand new user interface that is very user friendly, following feedback from customers.

The application offers real-time quotes; newsfeeds; research facilities, and a chat feature which enables a customer to make direct contact with the Customer Service Team during trading days (Monday to Friday).

The platform also offers an enhanced client interface including catering for those who trade at night.

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The client will get instant access to several asset classes in the global financial markets including; Single Stocks CFDs (US, UK, EU) such as Facebook, Amazon, Apple, Netflix and Google, BP, Carrefour;  Indices (Nasdaq, FTSE UK), Metals (Gold, Silver); Currencies (60+ Pairs), Commodities (Oil, Natural Gas).

The launch is part of Scope Markets Kenya strategy of enriching the customer experience while offering clients access to global trading opportunities.

Scope Markets Kenya CEO, Kevin Ng’ang’a observed, “the Sope Markets app is very easy to use especially when executing trades. Customers are at the heart of everything we do. We designed the Scope Markets app with the customer experience in mind as we seek to respond to feedback from our customers.”

He added that enhancing the client experience builds upon the robust trading platform, Meta Trader 5, unveiled in 2019, enabling Scope Markets Kenya to broaden the asset classes available on the trading platform.

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