Starting July 1, 2025, Kenyan car buyers will experience a significant price hike in imported used vehicles, following the implementation of a new tax valuation system by the Kenya Revenue Authority (KRA). The revised Current Retail Selling Price (CRSP) list—the first major update since 2019—is expected to increase import taxes on a wide range of vehicles.
Whether you’re a potential buyer, dealer, or importer, it’s critical to understand how this change will affect vehicle costs and the broader Kenyan automotive market.
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What is the CRSP and Why It Matters
The Current Retail Selling Price (CRSP) is a reference price used by KRA to calculate the customs value of imported used motor vehicles. This value is crucial because it determines the basis for several major taxes:
- Import Duty: Now 35% (up from 25%)
- Excise Duty: Ranges from 25% to 35% depending on vehicle type
- Value Added Tax (VAT): Fixed at 16%
- Railway Development Levy (RDL): 2%
- Import Declaration Fee (IDF): 3.5%
In simple terms, a higher CRSP value means a higher tax bill. Since these taxes are cumulative, even a modest increase in base value can lead to a sharp spike in the final cost of a vehicle.
Key Changes in the 2025 CRSP Revision
KRA’s newly revised CRSP list brings significant updates that will shape how taxes are calculated and how vehicles are priced in the market:
1. Expanded Vehicle List
- The new CRSP includes over 5,200 vehicle models, up from about 3,000 in the 2019 version.
- It now factors in trim levels, drivetrain options, and performance specs—not just engine size.
2. Updated Market Valuation
- CRSP values now reflect newer global vehicle prices and exchange rates.
- Since 2019, the Kenyan shilling has weakened from about 100 KSh/USD to approximately 130 KSh/USD, increasing the cost of imports.
3. Higher Tax Rates
- Import duty has risen to 35%.
- Excise duties on some vehicle types have increased from 30% to 35%.
4. Improved Transparency
- The update comes after extensive consultations with importers, car dealers, and clearing agents.
- The goal is to reduce tax evasion and ensure fair and predictable vehicle valuations.
How Will This Affect Car Prices in Kenya?
The impact on final vehicle prices will be significant, especially for popular models and performance cars. Here’s what to expect:
🚗 Luxury & Performance Cars
- Porsche 911 Turbo S: Tax bill may rise from KSh 4.7M to KSh 13.3M
- BMW M5 Competition: Expected tax jump from KSh 4.9M to KSh 7.7M
🚙 Common Budget Cars
- Toyota Probox: Import duty could exceed KSh 500,000
- Nissan Note: Taxes set to increase sharply, making it less accessible for many middle-income earners
🚘 Possible Exceptions
- Some newer SUVs with favorable depreciation rates may see slightly lower taxes, but these are outliers in an otherwise rising market.
Dealer Insights: What This Means for the Used Car Market
Used car dealers across the country have raised concerns about the financial pressure this update brings. According to industry players:
- Profit margins will shrink, leading to higher consumer prices
- Dealers may start importing more low-tax models
- Demand for locally used vehicles is expected to increase, as they become a cheaper alternative
Looking to avoid the heavy import costs? Browse local listings on Auto24 Kenya for second-hand vehicles already available in the country—ranging from compact hatchbacks to budget-friendly SUVs.
A Strained Automotive Market: Import Decline and Economic Pressure
The timing of this update compounds challenges already facing the sector:
- Used car imports have plummeted from over 200,000 to about 70,000 annually
- Forex volatility and skyrocketing shipping costs continue to hurt importers
- Regulatory hurdles and tax hikes are discouraging buyers
With rising import costs, we’re likely to see a surge in demand for local vehicles, as consumers look for affordable transport alternatives.
What Buyers Can Do: Smart Tips to Navigate the New Pricing
To survive the rising costs of imported vehicles, Kenyan drivers can consider the following:
- Compare Total Ownership Costs: Consider fuel economy, insurance, spare parts, and resale value.
- Go Smaller: Cars under 1500cc attract lower excise duty, making them more affordable.
- Think Electric or Hybrid: These vehicles may qualify for reduced excise rates. Learn more about such models at Automag Kenya.
- Buy Locally Used Cars: Avoid import taxes altogether. Visit Auto24 Kenya to find listings for the Toyota Axio, Mazda Demio, and Honda Fit Hybrid, all at competitive local prices.
KRA’s Position and the Way Forward
KRA defends the revised CRSP list as a long-overdue correction to outdated vehicle pricing. According to the authority, the update is aimed at:
- Improving revenue collection
- Enhancing tax fairness across vehicle types
- Aligning valuation methods with global standards
In tandem, KRA has also launched a tax amnesty program to help importers regularize outstanding tax payments without penalties.
Importers and clearing agents are urged to consult the updated CRSP list—now available on the KRA website—before making any purchase or clearing arrangements.
Conclusion: Prepare for a Changing Market
The upcoming CRSP update is more than a bureaucratic revision—it’s a market game-changer. Kenyan buyers should expect:
- Higher prices on most used car imports
- Greater demand for local used cars
- Changes in what types of vehicles are being imported and sold
Whether you’re a buyer, importer, or enthusiast, staying informed will be crucial in this new landscape.
To stay ahead of the curve and get the latest news, car buying tips, and regulatory updates, follow Automag Kenya. And for anyone shopping on a tighter budget, don’t forget to check out great deals on second-hand vehicles at Auto24 Kenya.
