Kenya’s tax appeal tribunal has upheld the Kenya Revenue Authority’s (KRA) decision to classify Ebee Mobility Kenya’s consignment of e-bikes as fully built units rather than assembly parts.
This ruling dealt a significant setback to the e-mobility startup, which had argued that the bikes were imported in parts for local assembly, qualifying for a lower 10% tax rate.
The KRA maintained that the shipments included complete e-bikes, missing only the batteries, and should attract a 25% import duty, 16% VAT, and excise duty at $81 (KES10,520) per part. The tribunal agreed, stating that the motor, not the battery, is the key component that defines an electric bike.
This ruling has broader implications for Kenya’s e-mobility industry, particularly for companies relying on importing parts for local assembly.
The decision may affect two-wheeler and electric vehicle assemblers like BasiGo, Ampersand, and Spiro, as it sets a precedent that motors in imported parts can determine tariff classification.
The tribunal’s decision raises questions about the consistency of Kenya’s tax policies in supporting the e-mobility sector. Ebee Mobility may appeal the ruling or push for policy revisions that offer clearer tax guidelines for partially assembled electric bikes.
