Small traders vow weekly protests over KRA customs benchmark

Nairobi, Kenya – Small-scale traders have vowed to organise weekly protests until the Kenya Revenue Authority (KRA) agrees to negotiate over the recent raise in the customs benchmark for consolidated cargo, according to reports on August 28. This sets the scene for ongoing demonstrations in Nairobi's business districts, with some enterprises remaining shut on Friday in opposition to the increased minimum yield for a 40-foot consolidated container, rising from Sh2.5 million to Sh3.2 million.

The Small Traders Association (STA) asserted that they will continue the demonstrations until KRA extends an invitation for dialogue. The association contended that the 28 percent hike puts micro-importers, wholesalers, and retailers reliant on consolidated shipments, particularly from China, at risk of survival. A traders' representative explained that the abrupt and substantial price increases pose an immediate threat to the basic viability of micro-importers, local wholesale networks, and daily retail traders.

The trader's stance, however, contrasts with KRA's explanation of the new benchmark. KRA Commissioner for Customs and Border Control Lilian Nyawanda claimed that the Sh3.2 million figure emerged from discussions among KRA, traders, consolidators, and other industry stakeholders. She stated that the parties met multiple times before reaching an agreement on the benchmark and its implementation date, with KRA emphasizing that the discussions were documented.

Nyawanda pointed out that the authority had granted traders a 30-day period to ready for the new benchmark, which became effective on August 21. "The 3.2 million per four feet container is not a new tax," she noted. "We have had several engagements and agreed on this amount. We even further went ahead and agreed on an implementation date."

Nyawanda emphasized that the benchmark was based on a review of the values of similar goods imported via consolidated cargo in recent years and represented the minimum anticipated customs yield from a 40-foot container under the streamlined clearance process. Earlier, KRA stated in a statement that the figure was not a fixed tax, emphasizing that actual customs liability remains tied to the transaction value, classification, and nature of the imported goods.

KRA described the review as prompted by adjustments in tax rates, exchange rates, freight and insurance expenses, and the overall cost of imported goods since the previous Sh2.5 million benchmark was introduced in the 2022/23 financial year.