The Rwandan government has renewed a zero-rated import duty on electric and hybrid vehicles, extending the tax exemption until the end of the new fiscal year 2024/25.

The decision is designed to accelerate the transition to electric cars and motorcycles and to reduce greenhouse gas emissions, according to the Ministry of Finance and Economic Planning.

The government first initiated a zero-rated import duty on electric vehicles (EVs) in April 2021, as it stepped up efforts to encourage uptake of EVs and investment in the budding sub-sector.

ALSO READ: Nine products exempted from taxes in new budget

The extension of the waiver is one of the tax incentives announced for the fiscal year 2024/25.

Other incentives include tax reduction on imported passenger buses.

Passenger buses with the capacity of 50 people are exempted from the import duty.

ALSO READ: Rwanda on course to grow electric mobility market

Buses with capacity of 25 people will pay an import duty of 10 per cent, down from 25 per cent, which is the threshold for the East African Community.

Road tractors for semi-trailers will pay a duty rate of zero per cent, instead of 10 per cent.

Motor vehicles for the transport of goods with a gross weight exceeding 20 tonnes will pay an import duty rate of zero per cent instead of 25 per cent.

Motor vehicles for the transport of goods with a gross weight exceeding five tonnes but not exceeding 20 tonnes will pay an import duty rate of 10 per cent instead of 25 per cent.

There are also tax reductions on essential imported commodities such as rice, sugar and cooking oil.