Uganda, Rwanda and parts of the Democratic Republic of Congo are staring at a possible fuel shortage after Kenyan tax authorities impounded hundreds of trucks that ferry fuel to the landlocked neighbouring countries.

The Kenya Revenue Authority (KRA) impounded the trucks in the past one week, demanding tax arrears dating back to 2015.

More than 200 trucks loaded with export fuel destined for Uganda, Rwanda, Burundi, South Sudan and parts of the DR Congo are grounded at the Eldoret and Kisumu fuel depots after KRA issued letters to transportation companies demanding taxes amounting to $7.2 million (Ksh757.6 million).

The tax demand emanates from KRA’s assertions that the oil marketing and transporting firms have been loading products destined for the export markets but which ended up being sold in the local market, an accusation the transporters have denied.

The Kenyan taxman has refused to clear the affected trucks from leaving Kenya Pipeline Company depots, igniting concerns of supply disruptions across the region.

The detainment also raises fears that Kenya could further lose its fuel export market as neighbouring countries look for alternatives routes, with Tanzania being the likely main beneficiary.

Kenya published new, reduced local and export tariffs for pipeline fuel transportation that came into effect on February 15, 2020, in a bid to help Kenya recover its export market.

“The transport companies together with oil marketing companies have provided proof to KRA that these trucks exited through Malaba and Busia and the documents provided include KRA exit notes and KRA rotation numbers all issued at the borders but KRA wants to hear none of it,” said a manager at a firm whose 30 trucks have been impounded.

He added that the transporters have also supplied the taxman with documents from respective authorities proving the trucks entered the countries.

“KRA has come up with new demands that we go to the countries where the product was destined and bring evidence that duties were paid there, a mandate that neither falls on KRA or Kenyan business entities,” he added.