The government of Kenya is set to review the age limit of imported used cars into the country. This would further increase the cost of importing used cars. The move is an effort to boost the local auto production capacity of new vehicles.
More car producers including Volkswagen and Peugeot have set base in Kenya by setting up assembly plants in Kenya. Currently, the age limit of imported used cars in Kenya stands at eight years. The Cabinet Secretary for Industrialization, Adan Mohamed, said that they were considering the reduction of the age limit to create a good environment for new car assemblers in the country. Other car assemblers set to enter the Kenyan market include the Nissan who are targeting the regional market. The Nissan plant will assemble pick-up trucks and semi-knocked down (SKD) kits.
Last year, the Kenya Revenue Authority (KRA) set new increased taxes on used cars when they revised the Current Retail Selling Price (CRSP). The new taxes which took to effect this year had faced stiff opposition from stakeholders who cited being left out in the policy-making process and the unaffordability of cars with the new taxes. Majority of Kenyans opt for second-hand vehicles which are more affordable than new cars.
A similar proposal was introduced in the neighboring Uganda which aimed at phasing out old cars by setting the age limit at eight years. The move was aimed at reducing environmental pollution in the country. However, the proposed bill was shot down by parliamentarians who chose profits over new employment opportunities and environmental sustainability.
