The Kenya Revenue Authority (KRA) is defending its decision to roll out a new pricing guide that will see import duties on some cars nearly double — sparking concern among car dealers and would-be buyers.
Starting July 1, KRA will adopt a revised Current Retail Selling Price (CRSP) system, a tool used to calculate how much tax importers pay on vehicles. The move has stirred debate across the motor industry, with many worried it will drive up the cost of owning a car in Kenya.
“This new guide reflects today’s reality,” KRA said in a statement. “The old model was based on 2019 data. That no longer makes sense in 2025.”
According to the tax authority, several factors triggered the overhaul — from a weaker shilling to higher duty rates and a wider range of cars now entering the Kenyan market.
In 2019, the exchange rate hovered around Ksh.100 to the dollar. This year, it’s closer to Ksh.130. Import duty has also jumped from 25 per cent to 35 per cent, and excise duty has climbed to a maximum of 35 per cent — up from 30 per cent.
Car importers say the changes have hit them hard.
Take the Toyota Vitz Hybrid, for example. Its duty has risen from Ksh.319,501 to Ksh.508,927. The diesel Mazda Demio has seen an even sharper climb — from Ksh.244,000 to Ksh.564,000.
“This is going to hurt ordinary Kenyans,” said Samuel Gichuki, a Nairobi-based vehicle dealer. “Most buyers depend on second-hand imports. If the tax is too high, they’ll be priced out.”
Others in the industry echo his concern. “It’s not just about paying more,” said Mary Nduta, who runs a used car showroom in Mombasa. “It’s about fairness. Was everyone really consulted?”
KRA insists they were.
Officials say the revision came after months of talks with stakeholders. They even invited public feedback.
“This wasn’t done behind closed doors,” KRA said. “The new pricing list is the product of consultations. We considered what dealers, importers and consumers had to say.”
One big change is how cars are now assessed. The 2019 guide mostly looked at engine size and drive type. The new list — covering more than 5,200 models, up from 3,000 — dives deeper. It takes into account trim levels, fuel type, and performance features.
Still, critics argue the end result may make cars more expensive than necessary.
Some industry players have called for a phased rollout or tax relief for smaller, fuel-efficient cars. Others want better public transport options to reduce the country’s over-reliance on cars altogether.
For now, KRA stands firm.
“We are committed to fair taxation,” said the agency. “This process is meant to reflect the realities of today’s market — not the one that existed six years ago.”
But on the ground, the reality is hitting home. Buyers are already bracing for steeper prices. And for many, owning a car might soon be out of reach.
