This archive report was first published on 16 June 2020.
On June 16, 2020, the Kenyan government's 2020 Finance Bill was tabled in Parliament, proposing a range of measures to address the economic impact of COVID-19.
However, the bill's proposal to reintroduce 14% VAT on clean cook stoves and Liquefied Petroleum Gas (LPG) has raised concerns among experts.
As Bernard Osawa, Project Director at Frontier Energy, notes, 'these changes will defeat the purpose of the introduction of the exemptions in the first place, which was to boost the growth of the industries, especially since they are essential industries in the Kenyan economy.'
The exemption of clean cook stoves and LPG from Value Added Tax (VAT) in 2016 was a forward-thinking decision that accelerated the uptake of safe alternatives to firewood, charcoal, and kerosene-based cooking.
Kenya received international recognition for this decision, and the clean cooking sector has seen significant growth in the intervening years.
However, the proposed reintroduction of VAT on clean cook stoves and LPG risks increasing the price of clean cooking for consumers, contradicting government efforts to shift consumers from wood fuel to cleaner fuels like LPG and bio-ethanol.
According to the World Health Organization, diseases from dirty cooking are the fourth biggest killer globally, causing more deaths than tuberculosis, malaria, and HIV/AIDS combined.
In Kenya, 21,560 deaths from dirty cooking every year is more than three times the national road accident toll.
Experts have warned that the elderly, smokers, and those with pre-existing conditions are most at-risk of COVID-19, and that smoke inhaled by women and children while cooking with dirty fuel is equivalent to smoking more than three packets of cigarettes every day.
Osawa concludes that the re-imposition of taxes on clean stoves and fuels will not only make them out of reach for low-income consumers but also withdraw sector support at a time when it is most needed.
