All Car Owners In Kenya To Soon Pay Wealth Tax

Car owners in Kenya are about to see strange taxes following a proposal by the National Treasury for them to start paying a Motor Vehicle Circulation Tax. This will be in addition to a wave of taxes and levies imposed by the Kenya Kwanza Government.

“There will be a minimum tax amount payable by all motor vehicle owners in addition to a graduated amount based on the engine capacity of the vehicle,” said a document from the National Treasury that is awaiting approvals.

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According to the Treasury, the Motor Vehicle Circulation Tax will target Kenyans buying cars at the point of acquiring an insurance cover. Car owners will start paying the tax once the buyer gains full ownership of the vehicle by purchasing insurance.

The motor vehicle circulation tax will be levied concurrently with the carbon tax which will be introduced to discourage the use of fossil fuels. The carbon tax is the push of President William Ruto as a sign of goodwill in championing for clean atmosphere and preventing adverse climate change.

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The government sees the tax as a solution that will address the twin challenges of addressing revenue challenges and stopping air pollution. “Government will explore the possibility of introducing a carbon tax based on the carbon content of fossil fuels.”

At the same time, the Kenya Kwanza government is looking at introducing an excise tax on tractors, forklifts, excavators, and earth movers but also introducing tax incentives that promote the use of green energy. There is no way out of this one.

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