UDA Legislature Tells Off Kenyans Not To Use Their Cars If They Can’t Pay New Motor Vehicle Tax

UDA Legislature Tells Off Kenyans Not To Use Their Cars If They Can’t Pay New Motor Vehicle Tax

Kuria Kimani, the MP for Molo Constituency and chair of the National Assembly Finance Committee, has defended the government’s proposal to charge car owners a motor vehicle circulation tax.

The levy proposed in the new Finance Bill 2024 intends to impose an annual fee on motor vehicle insurance cover acquisition.

The charge will be 2.5 percent of the vehicle’s worth, starting at Ksh.5,000.

Kimani, who described the levy as “a hybrid of income and wealth tax” on Tuesday, said the measure is intended to spur investment in what he described as an extensive local public transportation system.

“If you go to economies ahead of us, there are elaborate and very efficient public transport systems,” the MP told NTV in an interview.

“Every time investors want to invest in our public transport system through public-private partnerships, the feasibility studies show that we like to drive our cars so much that we are not able to attract foreign investment.”

He claimed that Kenyans prefer driving because the public transportation system is not “elaborate,” and that if offered with a superior alternative, Kenyans would avoid driving.

While the motor vehicle circulation tax would be linked to the annual renewal of insurance policies, Kimani argues Kenyans can avoid paying it by not driving their automobiles at all.

“If you don’t want to pay the motor vehicle circulation tax, then don’t use the car, like how you don’t use the expressway if you don’t want to pay for it,” he said.

The measure exempts ambulances and government-owned cars from the motor vehicle circulation fee imposed by the Privileges and Immunities Act.

Failure to collect and remit motor vehicle tax within five working days of issuing motor vehicle insurance cover, an underwriter shall be liable to a penalty of fifty percent of the uncollected tax plus the actual amount of the uncollected tax.

UDA Legislature Tells Off Kenyans Not To Use Their Cars If They Can’t Pay New Motor Vehicle Tax