Rédaction Africa Links 24 with Kenyans.co.ke
Published on 2024-03-05 13:43:40
The government is considering enhancing its taxation policies on vehicles that run on fossil fuels such as Diesel and Super Petrol. In the Medium Term Revenue Strategy report compiled by the Treasury, it was highlighted that the government will be exploring the introduction of a Carbon Tax on these vehicles. This taxation will involve increasing the excise duty on imported vehicles that use fossil fuel gradually over the targeted period from the upcoming Financial Year 2024/2025 through to 2026/2027.
Treasury emphasized that the aim of this taxation is to address environmental damage and negative health effects caused by motor vehicle emissions. The government will also be looking into introducing taxation on earth movers due to the harmful gases they emit into the environment. The specifics of the excise duty rates to be implemented in the review are still unknown at this time.
In a move to incentivize the uptake of environment-friendly vehicles, the government will also review taxes on electric vehicles. However, these taxes would increase the overall cost of buying and owning vehicles in the country, as the government plans to introduce other taxes on all vehicles alongside the Carbon Tax. One such taxation measure is the Motor Circulation Tax, which is a form of wealth tax. This tax will be paid annually by motor vehicle owners at the point of acquiring an insurance cover, with a minimum tax amount payable by all owners in addition to a graduated amount based on the engine capacity of the vehicle.
Overall, these taxation strategies aim to not only generate revenue for the government but also to encourage a shift towards more environmentally sustainable modes of transportation. By increasing taxes on vehicles that use fossil fuels and promoting the use of electric vehicles, the government hopes to mitigate the adverse effects of motor vehicle emissions on air quality and public health.
It is important for vehicle owners and industry stakeholders to stay informed about these proposed tax changes and prepare for potential increases in vehicle-related costs in the coming years. By understanding and adapting to these new policies, both individuals and businesses can contribute to a cleaner and healthier environment for future generations.
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