cars
The signing into law of the 2023 finance bill by Members of Parliament is already having an impact on many enterprises in the country, including the importation of automobiles. Following the imposition of a 35% tariff on all imported cars by the Treasury, car costs have risen dramatically, which can vary from 35,000 to 170,000 Kenya shillings, depending on the type of car imported and the engine that powers it.
Taxes, along with weak shilling and tough economic times have raised the cost of living beyond the reach of a majority of Kenyans, resulting in a drop in imports. A number of car importers have stated that the rise in tariff from 25% to 35% is nearly putting them out of business.
The cars have become costly for the majority of Kenyans, resulting in low volumes being cleared at the port. Dealers were able to move 4,000 cars per month on average, but this figure began to decline in July.
Dealers had warned that the tariff rise would result in a 10% increase in the price of imported autos.
Because of the downward spiral of the Kenyan shilling against the dollar which is the principal currency for imports, prices have risen by more than the predicted 10%. The dollar, which is almost at 146 against the shilling, has inflated the cost of autos even more, making dealers apprehensive of importing vehicles.
Car importers are not the only industry feeling the effects of rising living costs, industries ranging from agriculture to technology are also feeling the pinch. It will now be intriguing to see how the government will come up with measures to reduce living standards.
Also Read: Judiciary Transfers Judge Who Suspended Finance Act 2023
