President William Ruto announced a bold motorcycle price slash plan, stating that motorcycles currently priced at KES 190,000 will drop to KES 95,000, with a further reduction of KES 10,000 by eliminating taxes, during a meeting with boda boda operators at State House, Nairobi, on August 7, 2025.
Speaking to representatives from all sub-counties, Ruto outlined a strategy to lower deposits from KES 70,000 to KES 9,500 and daily repayments from KES 500 to KES 180, aiming to make motorcycles more affordable for low-income Kenyans.
However, the plan, part of his Bottom-Up Economic Transformation Agenda, faces doubts due to past unfulfilled promises and Kenya’s fiscal challenges.
The motorcycle price slash plan targets Kenya’s boda boda sector, a critical economic driver employing over 1.5 million youth.
Ruto emphasised that reducing costs from KES 190,000 to KES 95,000, coupled with a KES 9,500 deposit, would empower ordinary citizens, particularly young entrepreneurs, to own motorcycles and engage in income-generating activities.
The proposed tax elimination, expected to save an additional KES 10,000 per unit, requires parliamentary approval, a process Ruto vowed to champion.
He also pledged to enact laws promoting self-regulation in the sector to curb police harassment and foster growth, describing boda boda operators as “legitimate entrepreneurs” deserving of government support.
Despite the ambitious proposal, critics question its feasibility amid Kenya’s economic constraints. The Kenya Revenue Authority’s (KRA) 2025 Current Retail Selling Price (CRSP) schedule lists motorcycles like the Honda Ace CB125 at KES 135,000 and the TVS HLX 150 at KES 148,000, suggesting Ruto’s KES 190,000 benchmark may be inflated.
Tuko.co.ke reported that KRA’s import duties, including a 16% VAT and 25% import tax, add roughly KES 30,000–40,000 to motorcycle costs, making the KES 10,000 tax cut seem modest.
Political analyst Willis Otieno argued that Ruto’s administration, burdened by a KES 10.25 trillion debt, may struggle to forgo tax revenue, as 60% of collections are service debt.
Critics on view the plan as populist, given Ruto’s history of retracting tax reforms under public pressure, such as the 2024 Finance Bill withdrawal.
Motorcycles right now are not Ksh190,000, they are Ksh95,000. I will go to Parliament to remove the taxes available on motorcycles, which may reduce the prices by a further Ksh10,000 – President Ruto pic.twitter.com/XqU3B6q6XX
— Kenyans.co.ke (@Kenyans) August 7, 2025
Ruto’s focus on electric motorcycles, priced at KES 95,000 compared to petrol models, aligns with his push for sustainable transport. Capital News reported his directive to release over 9,000 impounded motorcycles not linked to criminal cases, a move to ease tensions with riders facing police crackdowns.
The plan also includes friendlier loan terms, with daily repayments of KES 180, negotiated with financing firms like Watu and Mogo, which dominate boda boda lending.
However, the Hustler Fund’s 68% default rate, as noted in a KHRC report, raises concerns about repayment sustainability for low-income borrowers. Critics argue that without addressing high fuel costs (KES 186 per litre) and inflation, the price cuts may not significantly improve affordability.
The proposed tax elimination faces legislative hurdles, as Parliament must amend the Excise Duty Act and VAT Act, which impose a 16% VAT and KES 2,160 excise duty on motorcycles, per KRA’s 2024 guidelines.
Ruto’s earlier tax hikes, including a 3% turnover tax on small businesses, sparked protests, forcing the withdrawal of the 2024 Finance Bill. Boda boda operators, while welcoming the price slash, expressed concerns about a proposed Public Transport (Motorcycle Regulation) Bill, which BAK rejected for mandating costly county-level boards and Sacco memberships.
Such regulations could offset the financial relief Ruto promises, potentially stifling the sector’s growth.
Pro-Kenya Kwanza fans praise Ruto’s focus on boda boda operators but demand clarity on implementation, while others label his policies inconsistent, citing past tax burdens.
The plan’s success hinges on securing parliamentary support and addressing fiscal constraints without compromising revenue needed for debt servicing.
