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New Car Prices To Drop After Presidential Order

Kenyans are now expected to gloom around with announcement of fall of prices of new cars following the order from President Uhuru Kenyatta.

The Kenya motor industry association has issued a report in May 17 that shows the estimated price of cars especially the locally assembled following the government directive and exempting them from Value Added Tax (VAT) as well as excise duty.Since the effectiveness of the directive, there has been an 11.1 percent increase in the sales of locally assembled vehicles in the country with famous companies including Isuzu East Africa and Toyota Kenya taking advantage of the same.

Following this directive from the President, experts have come up with findings on how the reduction in car prices will also affect the factors of production.For instance,the raw materials used such as steel and paint will be exempted from the excise duty and VAT.

Fully assembled cars price have shot up as tax exemption mechanisms are not extended to them.

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