•Latest data from the clean air fund report on Nairobi and air pollution,shows transport caters for 40 per cent of pollution followed by biomass fuels.
• the bill proposes to amend the excise duty on motorcycles from a specific rate of Sh12,952 per unit to a new rate of 10 per cent of the value of the motorcycle per unit.
The state has contradicted its recent policy on promoting e-mobilty by proposing to introduce excise duty on all imported electric motorbikes other than motorcycle ambulances.
This is following a proposal in the Finance Bill 2024 to amend Part 1 of the first schedule to the Excise Duty Act to remove excise duty on petrol engine motorcycles.
The proposal comes just 9 months after President William Ruto launched electric bikes in Mombasa in a bid to accelerate e-mobility adoption.
Electric motorcycles, priced at Sh150,000, are currently not subject to excise duty.
This was one of the incentives put in place by the state to empower the youth by lowering the operational costs in the ‘boda boda’ industry.
Fred Omondi a partner at Deloitte accountancy firm expressed concern over the misplaced agenda when it came to taxing electric bikes.
“The government is promoting environmental protection so ideally the incentives should cater to electric vehicles and motorcycles as opposed to petrol motorcycles,”said Omondi.
The Deloitte 2024 Budget Analysis report deemed the decision by the government counter effective as this would lower the demand for electric bikes.
“The proposal to remove excise duty on petrol powered motorcycles may increase the demand on petrol motorcycles and derail the Government’s policy on electric motorcycles,”said the report.
Latest data from the Clean Air Fund report on Nairobi and air pollution,shows transport caters for 40 per cent of pollution followed by biomass fuels at 25 per cent.
This further shows the need to find solutions to curb air pollution by automotives in large cities especially Nairobi whose population is 4.3 million according to the 2019 census.
In addition,the bill proposes to amend the excise duty on motorcycles from a specific rate of Sh12,952 per unit to a new rate of 10 per cent of the value of the motorcycle per unit.
This will birth a significantly higher tax rate and make it more expensive for the taxpayer to gain access to better quality motorcycles.
According to the 2024 Economic Survey,the value of principal imports of motorcycles and bicycles decline by 53.1 per cent to Sh645,180 from Sh1,376,670 in 2022.
This was attributed to deterioration of daily unit profitability which in turn led to a decline in the levels of demand.
However,petrol users are to brace for good times ahead as Energy and Petroleum Regulatory Authority announced a drop in fuel prices.
Petrol will be priced at Sh189 per litre while Diesel and Kerosene are set to go for Sh173 and Sh163 per litre respectively.