Waive KSh 700,000, Save KSh 893,200: The Stacked-Tax Maths of Ruto's Electric Car PromiseWaive KSh 700,000, Save KSh 893,200: The Stacked-Tax Maths of Ruto's Electric Car Promise

That gap sits at the heart of President William Ruto's promise, made at State House Mombasa on 22 May 2026, that the first 100,000 electric vehicles imported into Kenya would be free of import duty. This explainer walks through how an electric car is taxed when it lands, what the pledge would really be worth to a buyer, and why a promise from a podium is not yet a rate at the port.

Three taxes, one stacked bill at Mombasa

When a car lands in Mombasa, the Kenya Revenue Authority (KRA) does not add up a list of separate taxes. It builds them like a tower, each floor resting on the one below.

The Kenya Revenue Authority lists the charges on an imported car as import duty, excise duty, value added tax (VAT) at 16%, an import declaration fee and a railway development levy. The ground floor is the customs value, KRA's estimate of what the car is worth, worked out from the current retail price of a new equivalent less depreciation for its age.

Import duty is charged on the customs value. Excise duty, a tax on selected goods, is then charged on the customs value plus the duty. VAT comes last and is charged on everything beneath it: the value, the duty and the excise. The declaration fee and railway levy, each a few per cent of the customs value, sit alongside.

So every shilling of duty is itself taxed twice more on the way up. Remove the duty and the floors above it shrink too.

A KSh 2 million electric car, worked through

Take an electric car with a customs value of KSh 2 million ($15,404). KRA charges fully electric cars excise at 10%, against 20% for a petrol car of 1,000 to 1,500cc and 25% for hybrids.

At today's 35% import duty, the sums run as follows, before the declaration fee and railway levy.

On Mwenendo's arithmetic, the waiver saves KSh 893,200 ($6,879). The duty accounts for KSh 700,000 of that; the other KSh 193,200 ($1,488) is excise and VAT that no longer fall on the duty. The total tax drops from about 72% of the car's value to under 28%, and the cost of getting it onto the road falls by roughly a quarter.

For comparison, a petrol car of 1,000 to 1,500cc with the same customs value would pay about KSh 1.76M ($13,543) in duty, excise and VAT at today's rates. Electric cars already enjoy a head start of KSh 313,200 ($2,412) on that example, entirely from the lower excise rate.

Kenya's 35% car duty, renewed in June

The duty figure needs its own explanation, because KRA's own page still lists import duty on cars at 25%.

That 25% is the shared rate the East African Community sets for cars arriving from outside the bloc. Kenya charges more by taking a one-year exception, approved by the bloc and published in the EAC Gazette.

The EAC Gazette of 30 June 2026 records that Kenya will apply 35% for one year on "all motor vehicles of tariff headings 8702, 8703 and 8704", which cover buses, cars and lorries. Electric cars are classified within heading 8703.

The same notice gave Kenya a 0% rate on lithium-ion batteries for a year. Mwenendo could not find an entry in its Kenya schedule that carves electric cars out of the 35% car rate, nor a published KRA notice putting the President's waiver into effect. That does not rule out an exemption arriving through another legal instrument, but until one is published, the electric car buyer in the table above should plan on the left-hand column.

Ruto's 100,000-car pledge needs paperwork

This is a familiar gap. As Mwenendo explained in its guide to the gates between tax promises and your payslip, a presidential announcement changes nothing at KRA until it is written into law.

For car duty, much of that law is made in Arusha rather than Nairobi. Kenya can seek a fresh exception for electric vehicles, list them among the duty exemptions in the regional customs law, or run an approved remission scheme. Each route leaves a paper trail: a gazette entry, a rate in KRA's system and a date from which it applies.

The 100,000 cap also needs rules. Someone has to count the cars, decide whether electric motorcycles and buses use up the same allowance, and say what happens to the importer of car number 100,001.

Registered electric vehicles rose to 24,754 in 2025 from 796 in 2022, Citizen Digital reported, so the cap is about four times the size of the country's entire registered electric fleet.

The price tag on Africa's electric car rush

The stakes are rising. Africa sold more than 30,000 electric cars in the first half of 2026, more than double a year earlier, as Mwenendo reported in its coverage of Africa's electric car surge, with Chinese brands taking about 90% of South Africa's new electric car sales.

Running costs are the other half of the sum. Petrol has climbed to KSh 226.96 ($1.75) a litre in Nairobi after EPRA's latest price increase, while the e-mobility power tariff introduced in 2023 charges KSh 16 ($0.12) a unit at peak hours and KSh 8 ($0.06) off-peak.

For a buyer weighing an electric car, three numbers matter: the customs value, the duty rate actually in KRA's system on the day the car lands, and the date any waiver formally starts. On a KSh 2 million ($15,404) car, the difference between a promise and a gazette notice is close to KSh 900,000 ($6,932).