Understanding the New Excise Bill for Motor Vehicle Importation into Kenya
We are receiving a lot of questions on how the new excise bill which took effect on the 01.12.2015, will work. We hope this article will allow you to understand it better and ease your shipments into Kenya.
As part of motor vehicle importation into Kenya – most commonly there is import duty, excise duty, VAT, IDF charges, railway development levy and registration costs that an importer pays. The excise duty is one of the duties which is part of the total tax you pay to import a car into Kenya.
Regulation After the 1st of December 2015
After the 1st of December 2015 – the excise value is now a fixed amount. Which is either KES 150,000.00 or KES 200,000.00. The amounts would vary based on below:
KES 150,000.00 – for vehicle under three years from the current year based on the date of first registration of the vehicle
KES 200,000.00 – for vehicles over three years from the current year based on the date of first registration of the vehicle
On a vehicle whose excise tax was KES 450,000.00 – the excise tax would now be fixed at either KES 150,000 or KES 200,000 depending on the age. Resulting in a saving of tax payable.
On a vehicle whose excise tax was KES 75,000.00 – the excise tax would now be fixed at either KES 150,000 or KES 200,000 depending on the age. Resulting in an increase of tax payable.
All other taxes would still be payable; however the excise is now fixed as opposed to a percentage like it used to be.
For the 95% of vehicles being exported from the UK to Mombasa, Kenya – this law is very favourable as normally the excise element is normally more then KES 200,000 or KES 150,000 in effect leading to huge savings and cheaper imports.
We are currently working on updating our tax calculator to factor these changes.
Regulation Prior to 1st December 2015
Prior to the 1st of December 2015 – excise was worked out as 20% on the excise value. The excise value being a total of the customs value and the import duty amount.
We hope this article has helped you. Please note it is copyright and is based on information from the relevant sources we have got – should this article be in variance with the Excise Act, 2015 or any other law, the Excise Act or such other law shall prevail.