Why the CRSP List Was Revised – KRA Issues Official Clarification
KRA has finally addressed the concerns raised by stakeholders on the review of the Current Retail Selling Price (CRSP) for new motor vehicles. In a statement issued on Friday, June 6, 2025, KRA said the update is necessary to include new vehicle models and reflect macroeconomic indicators such as changes in the foreign exchange rate and tax rates.
According to the statement, this is the first time the CRSP list is being reviewed since 2019. KRA said a previous attempt to update the list in 2020 was halted after various sector stakeholders challenged it in court. As a result, the CRSP list has remained unchanged for six years despite the changes in the automotive market and Kenya’s fiscal environment.
“In 2020, the Authority’s attempt to review the CRSP was contested in court. So the current list has remained the same since 2019. There was therefore need to review the CRSP with stakeholders to reflect the changes in the sector,” the statement noted.
KRA said the reviewed CRSP is to reflect the current economic reality. Specifically, the Authority cited the changes in the Kenya shilling’s exchange rate and the amendments to customs and excise tax policies as the key factors that necessitated the review.
“For example, in 2019 the exchange rate was Kshs. 100 to the US dollar, in 2025 it’s Kshs. 130. The import duty rate which is a key factor in the CRSP has gone up from 25% in 2019 to 35% in 2025,” the Authority said.
The excise duty on some vehicle classes has also been revised. “The excise duty on some units has gone up to 35% compared to 30% in 2019. Many new and more advanced vehicle models have also entered the market which are not in the 2019 CRSP,” KRA added.
The reviewed CRSP list was developed after consultations with major stakeholder organizations including Kenya Auto Bazaar Association (KABA), Car Importers Association of Kenya (CIAK) and Kenya International Freight Forwarders and Warehousing Association (KIFWA). The Authority clarified that the review process took into account sectoral feedback and industry data to ensure fair valuation of motor vehicle prices.
The new CRSP list will take effect from July 1, 2025.
The CRSP is a reference price used by the Kenya Revenue Authority for taxation of motor vehicles. Taxation is computed based on the CRSP value and depreciation is applied according to the age of the vehicle – typically measured from the date of manufacture or year of first registration. This valuation approach is the basis for calculation of import duty, excise duty and value added tax (VAT) at the point of entry into the Kenyan market.
The changes have triggered a lot of reaction from industry players with concerns raised on the expected increase in tax liabilities for imported vehicles. For example KRA’s new valuation will raise the tax on a 1.5-litre petrol powered Mazda Demio to Ksh467,350, from Ksh247,109 after the vehicle’s CRSP was adjusted from Ksh1.67 million to Ksh3.39 million.
KRA defended the changes saying that the vehicle tax computation should be aligned to market values. The Authority said that maintaining outdated CRSP benchmarks would lead to revenue leakage and undervaluation of imported vehicles and ultimately affect fiscal performance and compliance equity among importers.
The Authority reiterated that the updated CRSP list is a regulatory tool mandated under the East African Community Customs Management Act (EACCMA) and aligned to the provisions of the Excise Duty Act and the Value Added Tax Act. The CRSP framework is meant to standardize the base value for taxation and prevent misdeclaration and manipulation of vehicle invoice values.
As required by law, the reviewed CRSP has the following parameters:
- Factory Price Benchmarking: Based on international motor vehicle manufacturer data and distributor pricing structures.
- Exchange Rate Adjustments: Based on the monthly exchange rate issued by the Central Bank of Kenya.
- Taxation Changes: Reflecting changes in import duty, excise duty and VAT as stipulated in the national budget and Finance Act.* Depreciation Framework: Calculated progressively according to the age of the vehicle and statutory depreciation rules.
The Authority also noted that the vehicle categories affected by the review are passenger vehicles, commercial vehicles, heavy-duty trucks, motorcycles and electric vehicles with each segment having specific pricing adjustments based on technological advancements and model diversification since 2019.
The stakeholder organizations that were involved in the consultation process are:
- Kenya Auto Bazaar Association (KABA)
- Car Importers Association of Kenya (CIAK)
- Kenya International Freight Forwarders and Warehousing Association (KIFWA)
- Motor Vehicle Assemblers Association of Kenya (MVAAK)
- Kenya National Chamber of Commerce and Industry (KNCCI)
- Used Vehicles Importers Association of Kenya (UVIAK)
- East Africa Customs Freight Forwarders Practitioners Association (EACFFPA)
Importers and consumers have raised concerns but KRA says the revised CRSP will promote compliance and fairness by having all imports valued the same way.
“The Authority will continue to engage with stakeholders to ensure smooth implementation of the revised CRSP and address any operational issues,” KRA said.
The revised CRSP list will be implemented on July 1, 2025 when the broader 2025/2026 Budget Policy Statement comes into effect. The new list will be available on the KRA portal and customs systems.
KRA will issue operational guidelines to customs agents, motor vehicle dealers and other stakeholders to facilitate the transition and compliance verification at all ports of entry.
Also Read: Mp Kuria Kimani Highlights Most Opposed 2025 Finance Bill Provision
Why the CRSP List Was Revised – KRA Issues Official Clarification