Vehicle importers call for tax reduction as government insists on age limit

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Vehicle importers should focus on maximizing resale value and lobbying for lower taxes and duty as the government insists on vehicle age limits.

Trade and Industrialisation Cabinet Secretary Peter Munya said the government would not backtrack on the proposed change seeking to limit the age of used vehicles with engine capacity above 1500cc imported into the country to five instead of the current eight years.

Japanese auto export company Be Forward, Market Development Group Global Business Department Manager Kei Tsuchiya said their focus would be in ensuring customers can get value on their newer vehicle whenever they want to re-sell meaning they will extract more value from their purchases.

“The government’s plan to reduce the age limit for imported cars from the current eight years to five years will also contribute as Kenyans rush to import newer vehicles. We aim to ensure that customers are able to capitalize on the vehicle’s resale value to match their dynamic interests,” said Kei Tsuchiya.

He was speaking at the launch of, A2Z Motors, Urban Drive Motors and Auto Biz Motors, three new outlets in Ruiru, Kiambu and along Mombasa Road, where he said that the government should focus on quality and favorable pricing for the customer over the vehicle’s age limit.

John Mutahi Be Forward Kenya Sales Account Manager said instead of fighting the proposal, industry players should gang up and back tax policies that will lower the cost of getting the newer imports.

“We have received information from the government of intent to lower the age limit from 8 years to 5 years by July 2019, However taxes & duty need to be reviewed accordingly to cater to the mass market from the high cost of vehicles that may hit the country,” echoed John Mutahi Be Forward Kenya Sales Account Manager.

Kenya imports over 90,000 both new and second hand vehicles every year, with new cars making up only 10 percent of vehicles on the roads.

The government plans to reduce the age limit for imported cars from the current eight years to five years by July 2019 that will see a huge increase in second hand prices and taxes payable on units.

The Kenya Bureau of Standards (KeBS) is however yet to release the draft legal amendments lowering the age limit and raising legal exhaust emission standards for all vehicle imports.

Kenya’s motor vehicle industry is expected to grow in 2019 with companies such as Swedish brand, Volvo, French carmaker, Peugeot, and German-based car maker, Volkswagen having established local assembling in efforts to meet the growing motor demand in the country.

SOURCE: standardmedia.co.ke


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