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Thousands of private car owners with high engine capacities will be hit with new taxes from next year under new measures to phase out the vehicles with more than 2500cc in Thursday’s budget.
“Private passenger motor vehicles fall under two categories, the high and low engine
rating vehicles. Currently, excise duty is charged uniformly on these motor vehicles irrespective of
the engine rating.
To ensure progressivity which is a cardinal principle of taxation, I propose to
increase excise duty from twenty percent to thirty per cent on private passenger motor vehicles
whose engine capacity exceeds 2500cc for diesel and 3000cc for petrol powered vehicles,” said the country’s Finance minister Henry Rotich.