Kenyans Poised for Additional Costs as NTSA Unveils Plan to Increase Charges

December 13, 2023

Kenyans are poised to feel another pinch following a proposal by the National Transport and Safety Authority (NTSA)to review its service charges to plug a budget deficit of more than Sh2.37 billion.

The transport sector regulator cites a consistent deficit in its financial performance, indicating that in the financial year ending June 30, 2023, the reported shortfall amounted to Sh550 million.

“This gap excludes additional funds required to finance the key road safety programmes and recurrent cost of maintenance of ICT systems and licenses for the same. The cumulative deficit as of June 30, 2023, was Sh2,374 million,” noted the Authority.

It added: “The current funding shortfall in development stands at Sh400 million, comprising Sh250 million allocated for the smart driving license and Sh150 million designated for counterpart funding with development partners.”

Sh20,000 To Approve Change of Car Colour

To address the deficit, the NTSA is proposing a substantial hike in the fees for 45 services, which includes a staggering increase from Sh500 to Sh20,000 to approve a change of color of a motor vehicle.

The fee for replacing a lost or damaged log book would increase to Sh10,000 from the current Sh2,500. Similarly, the cost of replacing a damaged or lost driving license would rise to Sh1,000 from Sh500.

Motorists would also see an increase in fees for converting their foreign licenses, with the proposed amount being Sh10,000, up from the current Sh1,000.

Meanwhile, the transfer of ownership for motor vehicles with an engine capacity not exceeding 1,000cc is set to rise to Sh10,000, a significant increase from the current Sh1,660.

Road Service Licenses Charges for Public Service Vehicles(PSVs)

The NTSA additionally proposes significant alterations to road service licenses for public service vehicles(PSVs). For instance, a road license for a PSV carrying between 6-8 passengers is slated to increase by 100%, moving from Sh.2,700 to Sh.5,400.

For a vehicle with a carrying capacity of nine to 14 passengers, the new fee would be Sh6,400, up from the current Sh3,200.

Similarly, the license fee for a 15-25 passenger vehicle is set to rise to Sh7,400, up from the current Sh3,750. For PSVs with 26 passengers or more, a 98% hike is proposed, raising the fee to Sh8,400.

“As an institution, our capacity has been growing. The number of stations we man has also been growing, so we need to improve on capacity to manage on the road traffic challenges and that’s why we need to increase our budget to foot the bills,” said NTSA board member Paul Posh Abwora.

Digital taxi operators such as Bolt and Uber are not spared either, with proposed increases of up to 100 percent. The new licensing fee is expected to be Sh200,000, up from the current Sh100,000.

Motor Vehicle Inspection and Registration Charges

Elsewhere, Inspection charges are set to increase by 100% to 250%, with vehicles below 3000 cc facing an increase from Sh1,000 to Sh2,000 for inspection. For heavy commercial vehicles exceeding 5 tons, the inspection charges are proposed to rise from Sh1,000 to Sh3,500, marking a 250% increase.

“Consider implementing a tiered fee structure based on the type and scale of services required. For example, the motor vehicle inspection fee of Sh1,000 currently charged for inspection of all vehicles including the three-wheeler (tuk-tuk) is not adequate to cater for the operational costs,” says the draft report.

The cost of motor vehicle registration is also subject to a 100% hike. Registration for vehicles below 1000cc would move from Sh1,700 to Sh3,400, while those with engine capacities of 3001cc and above will see a rise from Sh8,300 to Sh16,600.

Number Plates, PSV Badges, and Speed Limiters

According to the proposed charges, acquiring a regular number plate from NTSA would see an increase to Sh5,000, up from the current Sh3,000. Similarly, the cost of a PSV badge is set to rise to Sh1,500, compared to the current Sh1,000.

In the new pricing schedule, a speed limiter is expected to cost Sh150,000, representing a significant increase from the current Sh50,000.

The NTSA has also introduced additional revenue streams, incorporating new services and fees. This includes the inspection of accident vehicles, with a proposed charge of Sh1,500.

Moreover, an inspection center license is set at Sh200,000 annually, and the motor vehicle license for this new service is proposed at Sh3,000.

“The motor vehicle inspection fees should be revised to the optimal levels that reflect economic realities and the value of the motor vehicles being assessed, that could be charged as per the various categories for existing commercial motor vehicles,” NTSA said.

Driving School and Car Dealers License Fees

Further, under the proposed changes, the renewal fee for a license from a Class A driving school is set to increase to Sh50,000, up from the current Sh20,000. Similarly, the renewal fee for a permit from a Class C driving school would rise to Sh10,000, compared to the current Sh5,000.

The proposed renewal fee for a second-hand motor vehicle dealer’s license is set at Sh100,000, marking a substantial increment of over 2200% from the current range of Sh4,200 to Sh.9,600.

The proposals are currently undergoing stakeholder engagement and will subsequently undergo public participation before any full implementation.

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