Government Weighs New Road Maintenance Tax as Electric Vehicles Increase

Kenyan motorists could face a new road maintenance levy as the government explores, alternative ways of raising funds to maintain the country’s road network.

The Ministry of Roads and Transport announced the plans on Tuesday, November 3, saying the proposed financing mechanism would operate separately from the existing Road Maintenance Levy Fund (RMLF).

In a statement, the State Department for Roads linked the move to the growing adoption of electric vehicles in the country. The department said the shift towards electric mobility was changing fuel consumption patterns, with fewer vehicles relying on petrol and diesel.

The change could affect the amount of money collected through the fuel consumption levy, which currently contributes to the Road Maintenance Levy Fund.

According to the ministry, the increasing number of electric vehicles means the government needs to consider other sources of funding to support road maintenance.

“The State Department for Roads is exploring alternative financing mechanisms to mitigate the potential decline in Road Maintenance Levy Fund (RMLF) revenues arising from the growing adoption of electric vehicles, which reduces fuel consumption,” the statement read in part.

The proposed mechanism is intended to address the possible drop in revenue as more motorists shift to electric vehicles.

However, the announcement did not provide details on how the alternative financing system would work, how much motorists could be required to pay or when the proposed levy might be introduced.

The ministry also did not specify whether the new mechanism would apply to all vehicle owners or be structured differently depending on the type of vehicle.

For now, the State Department for Roads says it is exploring options to protect road maintenance funding as the country’s vehicle market gradually changes.

LINK: https://www.kenyans.co.ke/news/129106-govt-considers-new-road-maintenance-tax-electric-vehicles-gain-popularity?fbclid=IwZXh0bgNhZW0CMTEAcGRvZgRzcnRjBmFwcF9pZA80MDk5NjI2MjMwODU2MDkAAR-5YttIhwvbAiSJFxoA38JNt6FF6GH_0jkykW7DxJQ6izmfXnYRKMO3i4NQaw_aem_K2omeNSyUBk8FxBn_0RrDw