Kenyans buy 43360 vehicles in six months

[kwesta]

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And it is projected that the number could reach 100,000 by the end of the year.

With such numbers I think its high time the government encouraged local assembly of vehicles, especially the saloon. If we could get units going for 750,000 to 1.4 Million, as we do in other countries, then Kenyans will maybe stop buying Mitumbas.

Furthermore we got a huge market in the east African community.

Ghana is doing it with Orisson Motors, Nigeria too, South Africa is exporting all over. Its time the government came up with measures to encourage local assembly then we can bit by bit increase local imput till eventually all the content or at least 80 per cent is sourced locally.

But then again Kenya imports needles and razor blades.. Maybe I am dreaming too much

http://www.businessdailyafrica.com/Corporate-News/KRA--dealers-big-gainers-of-record-car-sales-growth/-/539550/2455826/-/f3s6b3z/-/index.html

[RV Pundit]

First they need to remove 8 yr rule (as long as KNBS inspection is done in Japan or source) then secondly reduce the taxes for new cars. For instance if you import 2yr old car; you should pay less tax rate than 10yr old car; that way more and more people can import newer ex-japan.

Right now...people are importing 8yr old car because gov tax policy is messed up. KRA should hire valuers at the port..who will value the car on the spot..and charge less tax for newer units.

[kwesta]

Indeed, the 8 year old rule is just idiotic to say the least when we have  vehicles manufactured in the 60s still operating in the road.

Uganda and Tanzania do not have the 8 year rule yet when you drive on their roads their vehicles  do not seem more beat-up than ours.

KRA should just introduce a flat tax for each make of vehicle no matter the year of manufacture, perhaps that would encourage people to buy new vehicles, and locally assembled vehicles should be charged even less.

Right now what we have is some chaotic system, the more popular the vehicle, the higher the taxes. The fellows at KRA usually wake up in the morning and decide to arbitralily increase taxes on whatever make is more popular in the market. I think a 8 year old Allion now attracts 5000 dollars in taxes.

[RV Pundit]

If car assembly is the kind of rot we saw in CMC (with secret overseas accounts) then we do not need car assemblies now.

Yes KRA duty is messed up...right now i hear car dealers selling new cars colluded to inflate CSRP...to make duty very expensive.

Look at BodaBoda...after Kimunya zero-rated taxes for 150cc and less...we have added nearly a million motorbikes..and they are now easing transport woes esp in rural areas...and even in Nairobi....they are saviours in traffic jams.

I think tax policy should not be based on yr....or crsp generic depreciation...that is KRA attempt to pass their weakness (corruption) on wananchi.Anyway we will rant forever but as long as ruling class owns the new car dealers there won't be any changes.

Uganda and TZ have it really good. Kenya people are still using donkeys to transport goods.

Indeed, the 8 year old rule is just idiotic to say the least when we have  vehicles manufactured in the 60s still operating in the road.

Uganda and Tanzania do not have the 8 year rule yet when you drive on their roads their vehicles  do not seem more beat-up than ours.

KRA should just introduce a flat tax for each make of vehicle no matter the year of manufacture, perhaps that would encourage people to buy new vehicles, and locally assembled vehicles should be charged even less.

Right now what we have is some chaotic system, the more popular the vehicle, the higher the taxes. The fellows at KRA usually wake up in the morning and decide to arbitralily increase taxes on whatever make is more popular in the market. I think a 8 year old Allion now attracts 5000 dollars in taxes.

[RV Pundit]

If car assembly is the kind of rot we saw in CMC (with secret overseas accounts) then we do not need car assemblies now.

Yes KRA duty is messed up...right now i hear car dealers selling new cars colluded to inflate CSRP...to make duty very expensive.

Look at BodaBoda...after Kimunya zero-rated taxes for 150cc and less...we have added nearly a million motorbikes..and they are now easing transport woes esp in rural areas...and even in Nairobi....they are saviours in traffic jams.

I think tax policy should not be based on yr....or crsp generic depreciation...that is KRA attempt to pass their weakness (corruption) on wananchi.Anyway we will rant forever but as long as ruling class owns the new car dealers there won't be any changes.

Uganda and TZ have it really good. Kenya people are still using donkeys to transport goods.Modern city like Nairobi has lots of hand carts..mkokoteni in the middle of the city.

Indeed, the 8 year old rule is just idiotic to say the least when we have  vehicles manufactured in the 60s still operating in the road.

Uganda and Tanzania do not have the 8 year rule yet when you drive on their roads their vehicles  do not seem more beat-up than ours.

KRA should just introduce a flat tax for each make of vehicle no matter the year of manufacture, perhaps that would encourage people to buy new vehicles, and locally assembled vehicles should be charged even less.

Right now what we have is some chaotic system, the more popular the vehicle, the higher the taxes. The fellows at KRA usually wake up in the morning and decide to arbitralily increase taxes on whatever make is more popular in the market. I think a 8 year old Allion now attracts 5000 dollars in taxes.

[Mintos]

I doubt KRA will change the system.  It is earning them money like never before. 43K vehicles in 6 months thats alot of vehicles.

Then there's KEBSs and the inspection companies. Pesa ni mingi sana in this vehicle importation biz. You've seen Jevic's license has been terminated and another is to be put in place na kumbe ni local politics

[Omollo]

I have been ranting about that 8 year old rule for ever. I never bought the justification and will never accept the reasoning. Anti-dumping? Is Kenya exporting (new or used) cars as well? Emissions? What levels? Some new cars pollute more than some old ones.

Tanzania removed taxes on commercial vehicles and thus allowed people to import vehicles made for personnel transport. There is enough of them so cases of overloading are limited to some special days when you really can't help it.

There are fewer accidents because the vehicles are in better shape and the owners and conductors don't have to rush to up their percentage.

You cannot force people to buy new cars by limiting their access to better quality used cars from abroad. Instead you allow them to make money - not least by using used cars - and when they become wealthy and affluent enough, they buy new cars.

[bittertruth]

Kenyans love newer models, even if the period is extended an average Kenya would seldom import a premio 2002 when we have 07 and above.

Harmonizing import duty and tax may kill the local dealers..likes of simbacolt, gm, Mahindra, Toyota, dt dobie, porsche and the like. Given an EVo X goes for 4.5M at the showroom, the CRSP for 8 year old evo would approximate 5000usd. Now this add the CIF from japan approx 6000usd. This gives 11000usd. uniform tax rate may mean they charge more for older cars or charge less for brand new/show room.

Indeed, the 8 year old rule is just idiotic to say the least when we have  vehicles manufactured in the 60s still operating in the road.

Uganda and Tanzania do not have the 8 year rule yet when you drive on their roads their vehicles  do not seem more beat-up than ours.

KRA should just introduce a flat tax for each make of vehicle no matter the year of manufacture, perhaps that would encourage people to buy new vehicles, and locally assembled vehicles should be charged even less.

Right now what we have is some chaotic system, the more popular the vehicle, the higher the taxes. The fellows at KRA usually wake up in the morning and decide to arbitralily increase taxes on whatever make is more popular in the market. I think a 8 year old Allion now attracts 5000 dollars in taxes.

[Omollo]

Kenyans love newer models, even if the period is extended an average Kenya would seldom import a premio 2002 when we have 07 and above.

Harmonizing import duty and tax may kill the local dealers..likes of simbacolt, gm, Mahindra, Toyota, dt dobie, porsche and the like. Given an EVo X goes for 4.5M at the showroom, the CRSP for 8 year old evo would approximate 5000usd. Now this add the CIF from japan approx 6000usd. This gives 11000usd. uniform tax rate may mean they charge more for older cars or charge less for brand new/show room.

You got me all confused. What is so important about having local dealers? What would the country lose if they die?

Trade is about competition. When the state intervenes on the part of some of parties, that takes away competition. There are laws against that which are effective in decent countries. Why is the state making policies that favour local dealers of foreign manufactured vehicles? Are any of these vehicles made in Kenya and therefore require some degree of "protection"? If these are Complete Knock Down Kits or whatever the assembling nonsense is called, how is the country benefitting? Is it a case of distributing tea spoons to everyone in the village instead of using spades or better still, using one or two Earth Movers just to create jobs?

How does the 8 year old rule benefit the country????
 

[obienga]

And it is projected that the number could reach 100,000 by the end of the year.

With inadequate infrastructure and planning to support the same, too few roads and stagnated road capacity, expect more Kenyans to spend significant portions of their day waiting in traffic.