NAIROBI, Kenya – For years, secondhand vehicles like the Toyota Vitz and Mazda Demio have been the go-to choice for many Kenyans looking for affordable, reliable transportation.
But starting July 1, 2025, that may no longer be the case.
The Kenya Revenue Authority (KRA) has announced a new Current Retail Selling Price (CRSP) schedule that will dramatically increase the customs tax on imported used cars particularly the smaller, budget-friendly models that dominate Kenyan roads.
So, what does this mean for car buyers and importers in Kenya? Higher costs, fewer options, and potential ripple effects across the automotive industry.
New CRSP List, New Costs
The CRSP is a tool KRA uses to determine the taxable value of imported vehicles. The higher the CRSP, the more tax you pay.
And under the updated list, the increases are significant.
Previously, cars like the Toyota Vitz and Mazda Demio were priced between Sh800,000 to Sh1.2 million.
With the new valuations, those same cars are now listed between Sh1.3 million and Sh1.6 million, depending on the model and specifications.
Specifically, the revised CRSP shows,a 5-seater Mazda Demio is now valued at Sh3,102,532.
A Toyota Vitz Hybrid on the other hand is listed at Sh3,440,622.
The impact isn’t limited to economy models. High-end hatchbacks are also affected.
The Audi A1 Sportback 25 TFSI (1.5L) now carries a CRSP of Sh6,633,385, while the S Line (1.0L) variant jumps to Sh9,024,534.
Industry insiders estimate that the new CRSP values will increase total import costs by Sh300,000 to Sh500,000, costs that will ultimately be passed down to consumers.
Why the Change?
According to KRA, the update is part of an effort to align valuations with global market trends and improve fairness in tax administration.
The agency stated that it conducted “extensive stakeholder engagement” before finalizing the new figures.
“This is about ensuring that taxes are applied uniformly and reflect the actual market value of the vehicles being imported,” read KRA’s public notice.
But for importers and prospective car owners, that rationale doesn’t soften the blow.
The Middle-Class Squeeze
Importers say the move could throttle demand and hurt small businesses involved in car resale.
“This policy hits the middle class the hardest,” says David Mwangi, a vehicle importer operating in Mombasa. “The person who was planning to spend under a million shillings for a clean Vitz or Demio will now have to rethink their entire plan.”
The changes come at a time when the cost of living is already high, and access to credit remains limited for most Kenyans.
For many, owning a car is more than a convenience it’s a crucial tool for work, family, and progress.
“I’ve been saving for almost two years to buy a small car,” says Sharon Wanjiru, a Nairobi-based primary school teacher. “Now with these changes, it feels like that goal just moved out of reach.”
Importers and Dealers Brace for Impact
The used car industry is one of the largest import-dependent sectors in the country.
Car dealers warn that unless the policy is revised or phased in gradually, the market could stall.
“We’ve already seen hesitant buyers and slowed orders,” says Peter Kamau, a used car dealer in Nairobi’s Ngong Road area. “Some importers are even halting purchases until they see how the market reacts.”
Others are rushing to bring in stock before the July 1 deadline to avoid the new CRSP figures altogether a move that could lead to supply imbalances and price spikes.
While the tax man insists the changes are necessary for better tax compliance, critics argue the decision could unintentionally widen the gap between the car-owning and car-less classes in Kenya.
Without affordable vehicle options, many Kenyans may find themselves priced out of mobility and opportunity.
Whether the new CRSP list achieves its intended tax fairness or becomes a roadblock to vehicle ownership for thousands of Kenyans remains to be seen.
But one thing is certain; for buyers and importers alike, the car-buying landscape in Kenya is about to shift gears and not everyone is ready for the ride.
