(Mombasa) – The Petroleum Institute of East Africa (PIEA) is calling for the removal of new levies beyond licensing requirements, citing a lack of harmonized regulations between Kenya’s county and national governments. The lobby group argues that conflicting requirements and unpredictable fees are creating significant challenges for petroleum businesses.
PIEA has presented its concerns to the Senate Committee on Transport, highlighting that petroleum dealers must secure multiple licenses and permits, with fees varying from one county to another. Additionally, agencies like the Kenya National Highways Authority impose separate levies, further complicating compliance.
PIEA General Manager, Wanjiku Manyara, criticized the fragmented regulatory framework, stating it has stifled the sector’s growth.
“The petroleum industry is required to obtain multiple licenses and permits from the county and national governments and has experienced adverse challenges with the ad hoc revisions in the levying of county licensing fees, taxes, and cess,” said Manyara.
The costs of doing business in the sector have surged, with petroleum firms facing rising operational expenses and increased administrative burdens. These challenges have particularly hindered growth at the county level.
Illustrating the issue, Manyara noted that licensing fees in Mombasa County for petrol stations have nearly tripled, rising from KSh 122,100 in 2023 to KSh 340,050 in 2024. The new rates include separate charges for signage, such as entry and exit boards, and canopy branding.
| Fee Breakdown – Mombasa County (Petrol Stations) | 2023 | 2024 |
|---|---|---|
| Licensing Fees | KSh 122,100 | KSh 340,050 |
| Signage (Entry/Exit Boards, Canopy Branding) | Included in fee | Itemized, additional charges |
In Nairobi, the compliance license previously issued by the Ministry of Lands for KSh 2,000 annually has been transferred to Nairobi County and now costs KSh 50,000 annually.
PIEA emphasizes that such fragmented and unpredictable regulations not only inflate business costs but also deter investment in the petroleum sector.