EAC set to harmonise car valuation

A Ugandan can check on the Internet for any car they like and bring it into the country. If the car is over 10 years old, the Uganda Revenue Authority will add a 20% surcharge as environmental levy. 

Kenyans restrict importation to cars eight years old and Tanzania only allows cars that are 10 years old.

However, the EAC countries are now planning to harmonise their car importation rules.

Richard Kamajugo, the URA commissioner for customs, recently said harmonising the valuation methods will offer value for money and environment protection.

“Uganda is the only country in the region still importing vehicles of any age. Some are brought in cargo containers because they cannot move. A lot more consultations are being done by counterparts in the region,” said Kamajugo.

He said some car importers have been taking advantage of the loopholes in the existing customs regulations by presenting forged car import documents so that the cars are undervalued, translating into less taxes.

The URA now does independent sourcing of information regarding imported vehicles.

Plans to harmonise car valuation methods has come when there is an outcry among bulk car importers in Uganda about the increasing cost of doing business, including a surcharge of 20% imposed on vehicles exceeding 10 years as an environmental levy.

Used car importation is also surrounded by the controversial pre-shipment inspection for conformity to roadworthiness, the project undertaken by Uganda National Bureau of Standards. Pre-shipment inspection has been resisted by some key stake-holders, including the Kampala City Traders Association over the alleged costs involved.

However low engine capacity imported used vehicles have continued to take a lead in sales in most of URA’s custom bonded warehouses for being economical in consumption and availability of the spare parts.

The New Vision