Uganda Hikes Tax on Old Cars

June 19, 2015 Taxation in Uganda

KAMPALA – Cars will soon be more expensive in Uganda, as the government imposes new taxes on old vehicles.

On June 18th the Commissioner of the Uganda Revenue Authority confirmed that the taxes applied on the import of used cars will be raised, as a means of encouraging consumers to buy newer and more efficient vehicles.

The environmental tax on the import of cars aged between five and ten years will be raised from the current rate of 20 percent to a new rate of 35 percent.

Any vehicle which is older than 10 years will be levied with a tax of 50 percent.

The increase in the rate of the environmental tax will lead to a hike in the price of transporting the car and the final retail price faced by consumers.

The Commissioner explained that the newly raised rates will help “wean” importers from brining in older cars, and will eventually demonstrate to consumers that “…that it is economically viable to buy a new car than an old car.”

Photo By: Colin