Car Imports in Rwanda: What’s Changing in 2025

Big changes are here for car imports in Rwanda in 2025. The government has introduced new policies focused on environmental goals and tax adjustments. Here’s what you need to know:

• Electric Vehicles (EVs): Models over $60,000 are fully exempt from customs duties. Those priced at $60,000 or less face a 25% tariff. EVs also enjoy VAT exemptions until June 30, 2028.
• Hybrid Vehicles: Tax benefits for hybrids are reduced. They now face VAT (18%), withholding tax, and excise duties based on age:
  • 0-3 years: 5% excise duty
  • 3-8 years: 10% excise duty
  • Over 8 years: 15% excise duty
• Vehicle Emissions: Rwanda now requires imported vehicles to meet Euro 4 equivalent emission standards.
• Age Restrictions: While no strict age limits are set yet, older vehicles face higher taxes, and inspections are stricter.

These changes aim to promote EV adoption, reduce pollution, and align with Rwanda’s sustainability goals under its Second National Strategy for Transformation (NST2). Importers should prepare for higher costs on traditional and hybrid vehicles while exploring opportunities in the growing EV market.

Rwanda passes law exempting taxes on electric vehicles

New Car Import Policies for 2025

Rwanda is rolling out updated car import policies for 2025, focusing on three major areas: taxation, environmental standards, and vehicle age restrictions.

Updated Tax and Duty Rates

The tax structure for imported vehicles has seen significant changes, particularly for hybrid cars, which are now subject to full taxation and new excise duties based on their age.

For hybrid vehicles, a tiered excise duty system has been introduced, penalizing older models more heavily:

• 0-3 years old: 5% excise duty
• 3-8 years old: 10% excise duty
• Over 8 years old: 15% excise duty

Electric vehicles still enjoy favorable treatment, but with some adjustments. Models priced at $60,000 or less now incur a 25% tariff, while those valued above $60,000 remain fully exempt from customs duties.

Public transport vehicles also face changes. Buses with a capacity of more than 25 passengers are now taxed at 10%, whereas larger buses, accommodating 50 or more passengers, continue to be duty-free.

These tax changes are designed to complement Rwanda’s broader goals of reducing emissions and encouraging cleaner transportation options.

Tougher Emissions Standards

Rwanda is leading the way in East Africa by adopting Euro 4 equivalent emission standards for imported vehicles. This move comes in response to growing concerns over air quality. The country’s push for stricter regulations reflects its commitment to improving public health and addressing environmental concerns.

"We are here to discuss air emission standards – a level of pollution you can not go beyond. Today we will examine all sources of air pollution and work together to ensure compliance with the new standards. We are grateful to the Climate and Clean Air Coalition for providing technical assistance to develop these emission standards", – Juliet Kabera, Director General of Environment and Climate Change at the Ministry of Environment

Under these new rules, vehicles imported into Rwanda must now meet specific pollution thresholds to be allowed entry. Previously, policies prioritized taxation over environmental compliance, but this shift underscores a more comprehensive approach to tackling emissions.

Stricter Age Limits for Imported Vehicles

Though formal age limits for imported vehicles are not yet in place, Rwanda is moving toward stricter regulations. As of mid-2025, over 95% of vehicles in the country are more than 10 years old, prompting calls for tighter controls.

Rwanda’s approach is expected to align with similar policies already adopted by other African nations. The government is also stepping up enforcement by establishing mechanical inspection centers through the National Police. These centers will ensure that both newly imported and existing vehicles meet the updated standards.

"Thanks for your participation today and giving us a green light to share this document with the public for comments. Standardisation will continue to be done in a transparent way and we will keep providing better services. Standardisation is not only about the environment but also quality. Quality should be the foundation of our culture and future", – Samuel Mporanzi, Director of Engineering and Urban Planning Standards, Rwanda Standards Board

These inspection facilities will play a critical role in ensuring compliance as the new policies take effect, setting the stage for a cleaner and more regulated automotive market in Rwanda.

Electric and Hybrid Vehicle Benefits

Rwanda is taking bold steps to promote clean transportation by offering targeted incentives for electric vehicles while scaling back benefits for hybrids. These measures are part of the country’s larger goal of transitioning to a fully electric transportation system.

No Import Duty for Electric Vehicles

Fully electric vehicles enjoy a VAT exemption until June 30, 2028. This exemption can save importers a substantial amount, as VAT typically adds 18% to vehicle costs.

For electric models priced at $60,000 or less, a 25% tariff is applied, while those above this price point are entirely exempt. Electric motorcycles also benefit from zero import duty .

While these incentives make electric vehicles more accessible, hybrid vehicles face a much different policy approach.

Reduced Benefits for Hybrid Cars

Starting in 2025, hybrid vehicles will no longer enjoy the same level of tax relief. An 18% VAT will be reinstated on hybrid models, with additional taxes like withholding and excise duties also coming into effect. This policy reflects concerns about the efficiency and environmental impact of aging hybrid vehicles.

"When hybrids get too old, they mainly rely on fuel rather than battery power, which defeats our environmental objectives." – Godfrey Kabera, Minister of State for National Treasury

From July 1, 2025, these changes will make hybrid vehicles less attractive, aligning with Rwanda’s push for fully electric transportation.

"In line with our commitment to environmental protection and reducing emissions, we want full-electric vehicles to become the preferred choice." – Godfrey Kabera, Minister of State for National Treasury

Tax-Free EV Equipment

Rwanda’s support extends beyond vehicles to the infrastructure needed for electric mobility. Charging station equipment is VAT-exempt until June 30, 2028, and EV parts benefit from exemptions on import and excise duties. An industrial tariff for EV charging is also in place .

Additionally, businesses establishing charging networks can access rent-free land, removing another financial hurdle. However, to qualify for these benefits, EV equipment must meet the Rwanda Revenue Authority‘s guidelines.

This multi-faceted strategy highlights Rwanda’s dedication to creating a robust electric vehicle ecosystem, ensuring that infrastructure and policy work hand-in-hand to drive adoption.

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How to Import Cars Under New 2025 Rules

Bringing a car into Rwanda under the 2025 regulations involves careful attention to paperwork, cost breakdowns, and registration steps. Fortunately, updated digital systems make the process more straightforward.

Required Documents and Paperwork

To import a car into Rwanda, you’ll need several key documents to confirm the vehicle’s origin, purchase details, and your identity as the importer. The Rwanda Trade Portal is a go-to resource for the latest requirements, as these may differ depending on the vehicle type and its country of origin.

Rwanda employs a Single Electronic Window system, which simplifies the process by allowing you to file import declarations and submit documents in one place. This system also facilitates communication with clearing agencies.

Here’s a quick rundown of the documents you’ll likely need:

• Certificate of Origin: Confirms where the vehicle was manufactured.
• Bill of Sale or Invoice: Proof of purchase.
• Shipping Documents: Includes details about the transportation of the vehicle.
• Identification Papers: Your personal identification as the importer.

If you’re importing an electric vehicle, additional certification may be necessary to ensure the car meets Rwanda’s standards for tax exemptions.

How to Calculate Import Costs

Rwanda determines import duties using the CIF (Cost, Insurance, and Freight) method. On top of this, you’ll need to account for several additional levies:

• 1.5% Infrastructure Development Levy
• 0.2% African Union Levy
• 0.2% Quality Inspection Fee

Don’t forget to include customs brokerage fees when filing clearance documents. It’s essential to provide an accurate valuation of your vehicle – undervaluing it is illegal and can lead to steep penalties. Customs officials may compare your declared value with international market data to ensure accuracy.

For instance, if your car costs $25,000 and shipping and insurance add up to $2,000, the CIF value would be $27,000. This amount forms the basis for calculating the import duties and fees.

Once you’ve completed the cost assessment, you’re ready to move on to vehicle registration.

Vehicle Registration Process

After clearing customs and paying all duties and fees, you’ll need to register your car. This can be done at Gikondo Customs Services Department (CSD) or Dubai Port World (DPW) in Masaka.

The Rwanda Revenue Authority (RRA) provides both online and in-person registration options. Before registration, your vehicle must pass a technical inspection to confirm it meets Rwanda’s road safety and emission standards. Once the inspection and document verification are completed, the RRA will issue your license plates and registration card.

Having all necessary documents ready can help speed up the registration process and reduce the number of trips you need to make to the office.

What These Changes Mean for Importers

The 2025 policy changes bring a mix of challenges and opportunities for car importers in Rwanda. These shifts will impact costs for buyers while opening doors to new business ventures, particularly in the electric vehicle (EV) market.

How Costs Will Change for Buyers

For those purchasing conventional gasoline and diesel vehicles, costs are set to rise. These vehicles now face higher fees, including a fixed annual road levy of RWF50,000 (about $37), along with a new road maintenance levy tied to fuel value.

Hybrid vehicles are also becoming more expensive, with increased excise duties based on their age. Adding an 18% VAT on top of these duties further raises the cost for buyers.

On the other hand, electric vehicles benefit from favorable policies. Models priced at $60,000 or below enjoy reduced tariffs, while higher-priced models are fully exempt from tariffs. Additionally, VAT exemptions for fully electric vehicles remain in effect until June 30, 2028, making them a more attractive option for buyers.

New Business Opportunities

As traditional vehicle costs climb, new opportunities are emerging in the EV market.

Electric vehicle dealerships and importers are well-positioned to thrive, thanks to government incentives like zero-rated duty-free benefits on EVs to encourage investment. For example, CFAO Mobility Rwanda introduced the first BYD dealership in 2024, showcasing models like the BYD Dolphin and BYD Atto 3. AUTO24 Rwanda also entered the market with Tesla vehicles, starting with the Tesla Model Y.

Charging infrastructure development presents another lucrative avenue. The government offers capped electricity tariffs for charging stations, rent-free land for development, and exemptions on import and excise duties for charging equipment. These measures aim to support the growing EV ecosystem.

Electric motorcycles are an especially promising sector. Starting January 1, 2025, only electric motorcycles can be registered in Rwanda, creating a captive market. Companies like Ampersand are already making an impact, operating over 4,000 electric motorcycles in Rwanda. These vehicles account for 13% of Kigali’s motorcycle taxi market, with riders completing over 14,700 battery swaps daily.

Electric Vehicle Market Growth

Rwanda’s electric vehicle market is expanding rapidly, bolstered by supportive policies and tangible benefits. The number of electric cars rose from just 19 in 2020 to 512 in 2024, while hybrid vehicles saw an impressive jump from 28 in 2021 to 6,660 by 2024.

This growth extends beyond passenger cars. Electric motorcycle taxi rides are 10–20% cheaper than their gasoline counterparts, with riders in Kigali averaging over 124 miles per day on electric motorcycles.

Firsthand accounts highlight the benefits of this shift. Vincent Uwimana, Acting Director of Agriculture and Animal Resources for Nyamagabe District, shared, "Electric cars are not only environmentally friendly but also cost-effective, leading to reduced prices for essential goods such as animal feeds". Similarly, business owner Vestine Mukanziza remarked, "Electric cars are transforming our lives; we now get feeds at affordable prices".

The government is further encouraging EV adoption with non-monetary perks like green license plates for preferential parking and prioritizing EVs in government fleets. Combined with the expansion of charging infrastructure, these measures are turning Rwanda into a key player in East Africa’s electric vehicle market.

For importers and dealers, the message is clear: the future lies in electric vehicles. Those who adapt quickly to importing EVs and offering related services will be well-positioned to dominate Rwanda’s evolving automotive market.

Getting Ready for Rwanda’s Car Import Future

Big changes are coming to Rwanda’s car import scene in 2025, and staying ahead means understanding these shifts and planning wisely. The move toward electric vehicles (EVs) isn’t just a passing trend – it’s quickly becoming the backbone of Rwanda’s automotive industry. This transition brings real advantages that are reshaping how cars are imported and sold.

The numbers back it up. EVs enjoy significant fiscal perks, while traditional vehicles face rising import duties. For businesses, this shift offers clear opportunities: companies that manufacture or assemble EVs in Rwanda qualify for a reduced 15% Corporate Income Tax rate and even tax holidays.

Importers are already pivoting to electric models to tap into these benefits. On the other hand, hybrid vehicles face a more complicated tax framework, with penalties tied to their age.

Beyond tax breaks, infrastructure development is fueling this transformation. Businesses establishing charging stations can use government land rent-free. The EV ecosystem is also expanding fast – Ampersand, for example, plans to produce 18,000 batteries by 2025 and already operates 32 battery swap stations around Kigali.

Still, challenges like limited policy awareness, financing hurdles, and a skills gap remain. Importers and dealers who stay updated on evolving policies and explore creative financing options will be the ones to thrive.

For drivers, switching to EVs offers real savings. On average, they save about $840 a year on fuel and maintenance costs. With Rwanda’s power infrastructure ready to support this shift, the groundwork is solid.

Rwanda’s goal to electrify its bus fleet by 2030 and the current incentives for EV early adopters highlight a long-term commitment to change. This isn’t just about following regulations – it’s about understanding where the market is headed and adapting to stay competitive. The traditional car import model is evolving, and those who embrace EVs now will lead the way in the future.

FAQs

How will Rwanda’s 2025 tax changes impact the cost of importing hybrid vehicles?

Rwanda’s upcoming tax reforms for 2025 are set to encourage green mobility, with adjustments specifically targeting hybrid vehicles. While hybrid cars will still enjoy a 25% import duty exemption, they’ll now be subject to an excise tax ranging from 5% to 15%, based on their age. For hybrids under three years old, there’s also a 5% withholding tax to consider.

In contrast, electric vehicles (EVs) continue to receive full exemptions from import duties and VAT. Additional perks are also in place for electric motorcycles and cars, reinforcing Rwanda’s commitment to eco-friendly transportation. Even with the added excise taxes, hybrid vehicles are expected to remain a budget-friendly choice compared to traditional vehicles, thanks to the retained exemptions and the country’s push for greener travel options.

What opportunities and challenges do businesses face when investing in Rwanda’s electric vehicle market under the new 2025 regulations?

Businesses eyeing Rwanda’s electric vehicle (EV) market in 2025 have some enticing opportunities. Tax breaks like import duty exemptions and zero VAT on fully electric vehicles and charging equipment help cut significant upfront costs. On top of that, the government is actively backing infrastructure development by offering rent-free land for charging stations, making it easier to set up EV networks.

That said, there are still hurdles to overcome. The country faces challenges like limited charging infrastructure, potential strain on the electrical grid, and a relatively small market, which could make large-scale adoption and investment returns more uncertain. While the incentives are a strong start, tackling these obstacles will be crucial for the long-term growth of Rwanda’s EV sector.

What do the new Euro 4 emission standards mean for car imports to Rwanda in 2025?

Starting in 2025, Rwanda will implement Euro 4 emission standards, effectively restricting the import of vehicles that don’t meet these stricter pollution limits. This move targets older cars with higher emissions, paving the way for newer, cleaner models to dominate the market.

For vehicle importers, this means focusing on cars equipped with advanced emission control systems and lower pollution levels. If you’re considering importing a vehicle, make sure it aligns with Euro 4 standards to avoid potential restrictions or extra expenses. This policy aligns with Rwanda’s broader commitment to reducing its environmental footprint and promoting cleaner transportation options.

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