Kenya plans to introduce new tax incentives to accelerate the adoption of electric vehicles, betting that lower costs for auto parts and charging stations will attract investors and speed up the transition away from fossil fuels.
The Secretary of State for Transport, Davis Chirchir, said these measures are part of a newly launched National Electric Mobility Policy , which now aligns the transport sector with Kenya 's climate commitments .
"Electric mobility is essential to reducing greenhouse gas emissions, decreasing dependence on imported fossil fuels and fostering economic growth through local manufacturing and job creation ," said Davis Chirchir.
In recent years, Kenya has introduced targeted incentives, including value-added tax exemptions for electric buses , bicycles, motorcycles, and lithium-ion batteries, as well as reduced excise duties on certain electric vehicles. New incentives include VAT and excise duty exemptions starting in July. The stamp duty applied to charging stations will be reduced in 2027.
The government has set itself the goal of equipping its ministries with 3,000 electric vehicles by the end of next year.
As part of the Paris Climate Agreement , Kenya has pledged to reduce its greenhouse gas emissions by 32% by 2030, with electric mobility identified as crucial, as the transport sector is one of the main contributors to carbon emissions.
Rapid growth
The market is experiencing rapid growth , with the number of registered electric vehicles increasing from 796 in 2022 to 24,754 in 2025, a rise largely driven by the increased use of electric motorcycles, buses and fleet vehicles in urban areas.
Sales of electric vehicles, including motorcycles, buses and private cars, are expected to reach a level equivalent to that of petrol and diesel vehicles by 2042, marking a structural change in the Kenyan transport system.
“We have now laid the foundations for a cleaner, more efficient and more sustainable transport system, fully aligned with our climate commitments ,” said Mohammed Daghar, Principal Secretary for Transport. “With the transport sector being a major contributor to emissions, accelerating electric mobility is essential to achieving our goal.”
Electric mobility policies in most African countries are still evolving, but interest in using electric vehicles in public and private transport continues to grow. Rwanda and Egypt have implemented a range of fiscal and non-fiscal incentives to encourage the adoption of electric vehicles. Companies involved in the manufacturing and assembly of EVs also benefit from corporate tax relief and tax exemption periods.
However, in many countries, the focus is primarily on electric buses and two-wheelers. Policies include tax exemptions on electric vehicle imports, investments in charging infrastructure, and pilot projects for electric public transport.
The transition, however, carries risks. Kenya relies heavily on fuel taxes to fund road maintenance and other transport-related services. Policy estimates that as electric vehicles replace gasoline and diesel engines, fuel tax revenues will fall by $693 million by 2043, compared to a deficit of $16.9 million in 2025.
Chirchir indicated that the government was studying alternative solutions, including road usage fees and possible taxes related to electricity, associated with charging stations, in order to compensate for this decline.
