Kenyans cut their spending on imported vehicles by Sh. 9.1 billion in the year ended May. This is according to official government data that showed the impact of increased taxes of second-hand cars worth below Sh. 1 million.
According to the data, the value of vehicle shipped into the country dropped to Sh25.8 billion in the period to May, down from Sh34.9 billion in a similar period last year. This represented a drop of 26 per cent. Units of cars imported dropped to 25,953 in the first five months of the year from 35,224 in a similar period a year earlier.
Vehicle registrations including used cars dropped to 26,290 units in the first four months of the year, down 43,861 in a similar period last year.
New vehicle sales dropped 30.2 per cent in the first six months of this year to 6, 946 cars, weighed down by higher interest rates.
Last month, the National Treasury dropped the flat rate duty of Sh200,000 for vehicles older than three years and Sh150,000 for newer ones introduced in December, in favour of the previous 20 per cent levy of the car’s value.
This brought down the cost of Toyota Belta to about Sh850,000 from a high of nearly Sh. 1 million.