Kenya’s used vehicle dealers protest

Kenya’s used car dealers have sounded the alarm over the

growing importation into the local

Used cars being imported into Kenya are depreciated up to 86

per cent from the eighth year to arrive at the customs value.

Nairobi. Kenya’s used car dealers have

sounded the alarm over the growing

importation into the local market of

Uganda-registered vehicles whose quality

is not known and for which no taxes

have been paid.

Many Kenyans are reportedly now

involved in a tax and regulatory

arbitrage to ship in cheaper and older

cars. Most of the used cars coming from

Uganda, though cheaper, are much older

than those in the Kenyan used car

market because Kampala has not put an

age limit on imported second-hand

automobiles.

This implies that one can ship in a much

older car through Uganda, declare low

custom value and pay much lower taxes

compared to direct importation into

Kenya where used cars aged more than

eight years cannot be allowed in.

“We wish to alert you of the large

number of Uganda-registered vehicles

operating in Kenya, specifically Western

Kenya,” the secretary-general of the

Kenya Auto Bazaar, Charles Munyori,

wrote to Kenya Revenue Authority (KRA)

Commissioner-General John Njiraini in a

letter seen by the Business Daily.

“We have also noted that people have

started buying and selling them locally

while bearing the Uganda registration

plates, meaning no taxes are paid.”

Mr Munyori further said that most of the

vehicles do not meet the quality

standards set by the Kenya Bureau of

Standards (Kebs), urging the taxman to

investigate how the cars are able to be

sold and operate locally without paying

the necessary taxes. The KRA says it

continues to implement strict

surveillance on all cars, whether in

transit or imported on a temporary

basis.

The taxman, however, could not say how

many Uganda-registered cars are

currently operating in Kenya.