KRA Loophole Kenyans Use to Sneak in Cheap Cars

  • Imported cars at the port of Mombasa await clearance.
    Imported cars at the port of Mombasa await clearance.
    File
  • It's not uncommon to encounter cars with Ugandan number plates on Kenyan roads, some of the cars being high-end machines. 

    In the border towns of Western Kenya, the Ugandan-registered plates nearly match the Kenyan vehicles. 

    Many Kenyan car owners have over the years imported cars through Uganda which many say is a cheaper option than shipping them to Kenya. 

    This has left Kenyan car dealers crying foul over the influx of the cheaper vehicles, either diverted from Uganda-bound cargo or rerouted once cleared in the landlocked country.

     A car bearing Ugandan number plates
    A car bearing Ugandan number plates
    File

    KRA has conducted crackdowns on multiple occasions following complaints by Kenyan car dealers. 

    Many who import cars through Uganda and sometimes South Sudan, avoid paying high taxes set by KRA which are sometimes as expensive as the price of the car. 

    Uganda has a 15-year limit for the importation of used cars which means that one can import vehicles that have depreciated in value and are more affordable. 

    On the other hand, Kenya only allows the importation of cars aged 6 years or less meaning they are more expensive. 

    According to KRA, importing a new Toyota Vitz Manufactured in 2014, one would need to part with  Ksh266,813 in taxes. 

    This includes an Import Duty of  Ksh 86,068, Excise Duty of a similar amount and VAT tax of 82,626. 

    Importing the same vehicle in Uganda would set you back only Ksh46,522 in taxes. 

    Kenyans who import their vehicles through the neighbouring country are forced to use Ugandan number plates since registering in Kenya would be similar to importing it afresh. 

    To use Ugandan number plates in Kenya, one has to apply for a special temporary permit through KRA. The permit is only available for vehicles coming from the Common Market for Eastern and Southern Africa (Comesa) bloc. 

    The permit indicates the reason for use and the duration of use. Owners have to apply for renewal upon the expiry of the special pass. 

    Since traffic police also know about the scheme, drivers with Ugandan number plates can be subjected to inspection to determine the cars legal status in the country. 

    Operators of foreign vehicles whose vehicles do not meet the requirements are made to re-export their vehicles with immediate effect. Authorities are also allowed to impound the vehicles.

    Motorists on a Colossal Traffic Jam Along Busy Uhuru Highway in Nairobi
    Motorists on a Colossal Traffic Jam Along Busy Uhuru Highway in Nairobi
    Simon Kiragu
    Kenyans.co.ke