Ibrahim Bbosa, a spokesperson for the Uganda Revenue Authority (URA), has clarified how import taxes for used vehicles are determined in Uganda. Contrary to common belief, the purchase price of a used vehicle does not directly influence its tax value. Instead, the URA provides a motor vehicle value guide on its portal, which outlines customs values for used cars, updated on a monthly basis.
There are several components to consider when calculating import taxes for vehicles in Uganda. Firstly, import duty is calculated as a percentage of the vehicle’s Customs Value, which includes the cost of the vehicle, insurance, and freight (CIF). Typically, the import duty rate hovers around 25% for most vehicles.
Additionally, Value Added Tax (VAT) is applied to the total sum of the CIF value and import duty. In Uganda, the standard VAT rate stands at 18%. Furthermore, Uganda imposes an environmental levy on older vehicles to discourage the importation of less environmentally friendly cars.
Importers should also be aware of registration and other associated fees, such as those for vehicle registration, license plates, and administrative costs, which may incur additional expenses.
To calculate the taxes applicable to importing a used vehicle, a specific formula is utilized. Import duty is calculated by multiplying the CIF value obtained from the database by the import duty rate. VAT is then determined by applying the 18% rate to the sum of CIF and import duty. Additionally, Withholding Tax (WHT) is calculated as 6% of the CIF value, while an infrastructure levy is imposed at a rate of 1.5% of the CIF value.
However, it’s important to note that if the imported vehicle is manufactured in 2023 or later and is less than 5 years old, the environmental levy is not applicable. The total tax payable is the aggregate of import duty, VAT, WHT, and the infrastructure levy.
To simplify the process for clients, the URA provides a motor vehicle import duty calculator on its portal, allowing importers to estimate the taxes associated with importing a used vehicle accurately.
when was the values determined, in which year was it made. Remember every year the vehichle depreciates.please help impoters and start using current prices of used cars from japan