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Close to 10,000 second-hand cars are currently stuck at East Africa’s biggest port after Kenya’s tax man issued new directive meant to curb tax evasion

A car carrier discharging imported motor vehicles at the Port of Mombasa.
  • An estimated 6,000 second-hand cars are stuck at the Mombasa port awaiting clearance and issuance of logbooks.
  • This follows Kenya Revenue Authority’s new directive requiring that no imported vehicle be released into the market before it is fully registered and issued with a logbook.
  • A shortage of registration number plates is also adding to the clearance delays.

Close to 10,000 second-hand cars are currently stuck at East Africa’s biggest port following a sharp shortage of official documents needed before releasing them into the market.

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An estimated 6,000 second-hand cars are stuck at the Mombasa port awaiting clearance and issuance of logbooks.

This follows Kenya Revenue Authority’s new directive requiring that no imported vehicle be released into the market before it is fully registered and issued with a logbook.

“We are experiencing delays in releasing vehicles due to the fact that the process of printing and signing of the logbooks takes a lot of time, hence putting importers in the same problem of paying extra demurrages (storage charges) due to this process,” said the Car Importers Association of Kenya (CIAK) national vice chairman M. Farooq in a letter addressed to KRA’s commissioner of custom services.

The delays are causing car importers to incur additional costs running into millions of shillings that could translate into higher customer prices. The car dealers say the delays have pushed them into a cash flow crisis since some are servicing loans.

“We would like to request your good office to allow us to release the said vehicles on the production of an e-sticker and the registration number to save us from the great losses due to unforeseen delays that are beyond our control,” says the letter dated March 14 and which is also copied to NTSA.

This new rule is part of an ongoing fight by the taxman against tax evasion. Until the new directive came into effect unscrupulous traders used to dump imported cars in the local market after falsely declaring that they are destined for neighbouring landlocked countries Uganda and Rwanda.

Previously, vehicle importers only required to have the National Transport and Safety Authority (NTSA)-issued electronic stickers and number plate registration to get their cars cleared from the port.

A shortage of registration number plates is also adding to the clearance delays.

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