Used Cars Business Slows Further

2473 Views Kampala, Uganda

In short
Dealers at several car selling points in Kampala that Uganda Radio Network visited, said prices have shot up in reaction to the hiked environmental levy.

Used car sales have reduced in Uganda, partly because of the hiked environmental levy by government. The levy has increased prices of the cars, which has pushed away many potential buyers.
 
Dealers at several car selling points in Kampala that URN visited said prices have shot up in reaction to the hiked environmental levy, and other charges. Government this financial year increased environmental levy from 20% to 50%.
 
Hanifa Semulinde of Semu Motors says the heavy taxation on used vehicles has increased importation and selling costs, forcing many importers to reduce car imports.
 
//Cue in: They imposed taxes …
Cue out: get another one.
 
In addition to the environmental levy, a car importer also pays import duty, value added tax and withholding tax. 
 
Semulinde says the volatile economic situation, coupled with the unstable South Sudan economy have also greatly affected car sales.
 
At Pine, a popular car dealing point on Lumumba Avenue, hundreds of dealers idle around but no buyers come to them. 
 
Mohammed Ssebuwufu, the Chairman of the Pine car dealers, admitted that car sales have plummeted and the dealers are increasingly finding it hard to operate.
 
Although he declined to reveal sales figures, Ssebuwufu says they are selling fewer cars compared to before the new tax regime.
 
In the wake of the tax hikes, the Commissioner General of Uganda Revenue Authority, Doris Akol defended the move. She argued that it would help decrease the importation of old and environmentally unfriendly cars.
 
Statistics from Uganda Investment Authority show that motor vehicles are among the top five imports and exports of Uganda. Hope Waira, UIA's Senior Investment Executive told URN in September that 

 

About the author

David Rupiny
In his own words, David Rupiny says, "I am literally a self-trained journalist with over 12 years of experience. Add the formative, student days then I can trace my journalism roots to 1988 when as a fresher in Ordinary Level I used to report for The Giraffe News at St Aloysius College Nyapea in northern Uganda.


In addition to URN for which I have worked for five years now, I have had stints at Radio Paidha, Radio Pacis, Nile FM and KFM. I have also contributed stories for The Crusader, The New Vision and The Monitor. I have also been a contributor for international news organisations like the BBC and Institute for War and Peace Reporting. I am also a local stringer for Radio Netherlands Worldwide.


I am also a media entrepreneur. I founded The West Niler newspaper and now runs Rainbow Media Corporation (Rainbow Radio 88.2 FM in Nebbi). My areas of interest are conflict and peacebuilding, business, climate change, health and children and young people, among others."