High price of personal cars in Ethiopia

In recent years, despite the rise of price of personal cars, people in Ethiopia have become more active in the car market. A couple of private car dealerships are opened in Addis Ababa as well as regional cities making different makes and models of cars available to customers.

Even if the car market has been moving fast, it is noticeable that the price of cars in Ethiopia is considerably high compared to where they are imported from. According a brief report from VOA, the high price of personal cars in Ethiopia is mainly due to 5 different types of taxes that are imposed on imported cars. According to the report, taxes for personal cars start from 125% of the value up to 244% of the value. The reason behind high tax rate on imported personal cars in Ethiopia is the fact that they are classified as luxury items. But this categorization does not include vehicles that are meant for public transportation, agriculture and construction, which are imported tax free based on approved conditions.

But added to the different taxes that are imposed on personal cars, the price of cars from the sources (Europe and Arab Emirates) is getting higher, playing its own share in taking the price of personal cars in Ethiopia higher.

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