Popular politician-businessman Buzeki Bundotich, the chairman of Buzeki Group of Companies, on Wednesday, June 21, revealed that he had embarked on a drastic action aimed at downsizing his truck business.
Shortly after the approval of the fuel VAT increase by Members of Parliament, Buzeki expressed his regret in a statement, acknowledging that the downsizing of his truck business had become a necessary step for survival. The MPs had moments before passed a clause within the Finance Bill 2023, which raised the Value Added Tax (VAT) on petroleum products from eight percent to 16 percent.
One of the notable measures taken by Buzeki in response to the circumstances was the removal of older trucks from the roads. This decision was motivated by their high fuel consumption rates, coupled with the anticipation of further price increases in the months ahead.
Buzeki elaborated on his plans, stating that the old trucks would be directed to scrap yards, where they would either be sold or repurposed. Meanwhile, Kenyans are bracing themselves for the possibility of petrol prices surpassing Ksh200 per litre.
"Due to the rise in VAT on fuel from 8% to 16%, we are now officially downsizing with immediate effect. All old trucks, including those with Euro 3 and below, will be sent to the scrap yard," Buzeki announced.
The businessman, who unsuccessfully contested for the Uasin Gishu gubernatorial seat in the 2022 General Election, hinted at acquiring electric lorries to sustain his transportation business.
Established in 1999, Buzeki Group of Companies, specializes in logistics and heavy commercial transportation within the East African region.
In addition to its transportation business, Buzeki Group diversified its investments into the dairy industry, aiming to establish a strong foundation for its various ventures.
Fuel VAT
On Wednesday, Azimio la Umoja lawmakers presented amendments to the Finance Bill 2023 insisting that fuel VAT be retained at 8 per cent.
The opposition legislators, however, failed to sway their Kenya Kwanza counterparts to halt the proposed increase to 16 per cent.
Azimio contested the decision arguing that it will lead to a high cost of living and strain the transport sector even further.
Kenya Kwanza, on the other hand, insisted that raising the VAT was key to raising revenue for President William Ruto's administration, enabling the government to fulfill its mandate.
Ruto had earlier defended the rise indicating that it will help his administration raise Ksh50 billion, which will be used to fund infrastructure development.
