21 August 2014

Kenya: Car Importers Protest Over New Port Charges

MOTOR VEHICLE importers are opposed to the new charges by the Kenya Ports Authority.

The Car Importers Association of Kenya now wants the charges reviewed saying the new levy pushed up the cost of business leading to losses.

In a letter to the KPA managing director dated August 14, the importers are seeking an urgent meeting to resolve the issue.

"We regret to notify you that we have complaints from our general membership that they are not ready for these charges," reads part of the letter.

Association chairman Peter Otieno told the Star the new tariffs are hurting car business in the country.

"Importers of motor vehicles demand a downward review of these tariffs. KPA chairman and the government said they want to make the port cheaper in terms of doing business and boosting the country's economy. What they are doing now is the opposite," said Otieno.

KPA revised its shore charges for motor vehicles and machinery imports last month.

The tariffs which came into effect from August 1, increased shore handling charge of vehicles not exceeding 1.5 metric tonnes to $83 (Sh7,221) up from $80 (Sh6,960) per unit.

These include saloon cars, station wagons, vans and crossover utility vehicle (cars with a bigger seating capacity but not exceeding 1.5 metric tonnes).

Wharfage charges - (handling through the port) of vehicles not exceeding 1.5 metric tonnes now cost importers an increased charge of $67 (Sh5,829) up from $65 (Sh5,655) per unit.

Shore handling charges for vehicles not exceeding 10 metric tonnes however reduced from $665 (Sh57,855) per unit to $580 (Sh50,460). They include buses, trucks, tractors and light folk lifts.

Revised rates for construction, industrial vehicles and heavy duty lifting equipment over 10 metric tonnes also reduced from $1,065 (Sh92, 655) to $950 (Sh 82, 650) per unit.

Construction vehicles, industrial vehicles and heavy duty lifting equipment over ten metric tonnes, now attracts a lower charge of $700 about Sh 60,900 per unit from $775 (Sh 65,875).

Otieno however argued that imports on vehicles not exceeding 1.5 metric tonnes is higher and increasing their charges is hurting business.

"We now import about 12,000 vehicles per month up from 9,000 last year. Why increase the small units and reduce the bigger ones. It does make sense. The increase will discourage dealers from the business," he said.

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