By Kenya will lower the tax benchmark applied to consolidated cargo imports and scrap a disputed advance cargo declaration requirement, the Ministry of Investments, Trade and Industry said on Tuesday, following talks between President William Ruto and traders over rising import costs.
The changes come after weeks of friction between small and medium-sized traders and the Kenya Revenue Authority (KRA) over how consolidated cargo — goods imported in bulk on behalf of multiple traders and later split up for individual owners — is valued and taxed.
According to a joint communique from the ministry and the MSME Alliance of Kenya, the KRA will cut the applicable benchmark for general consolidated cargo to 2 million Kenyan shillings ($15,500) from 2.5 million shillings. Existing rates for ready-made garments, footwear and fabrics will remain unchanged, as will recently negotiated rates for air cargo.
The advance cargo declaration requirement, which traders said had added delays and costs to clearance, will be removed “to streamline cargo clearance and facilitate legitimate trade,” the communique said.
The disagreement centred on the benchmark KRA used to value consolidated cargo shipments, which traders said had pushed up the cost of doing business for thousands of MSMEs reliant on bulk imports. Ruto’s intervention followed direct engagement with representatives of traders and stakeholders in the consolidated cargo sector, according to the statement.
The government and traders reached what the communique described as an agreement to resolve outstanding issues “while strengthening compliance, transparency and accountability in the consolidated cargo sector.”
The agreement is subject to several conditions. KRA will draw up and publish an exclusion list of goods that will not qualify for clearance under the general consolidated cargo framework, based on the value and nature of goods, applicable specific tax rates, excisable goods and other customs and revenue considerations.
All cargo consolidators will also be required to register and undergo fresh vetting by KRA, submitting a comprehensive list of the individual traders and importers whose goods they consolidate. The deadline for completing registration, vetting and disclosure of trader information is Oct. 15, 2026.
The government will facilitate the establishment of designated de-consolidation centres in Nairobi and Mombasa, intended to allow consolidated cargo to be separated for individual traders more efficiently, the communique said.
As an immediate step to lower logistics costs, state-owned Kenya Railways will reduce the charge for moving cargo from the Inland Container Depot to the Bomaline De-consolidation Centre to 10,000 shillings from 58,000 shillings, effective immediately, according to the statement.
The government also said it would expand existing legislation to reserve retail trade and specified lower-level jobs for Kenyan nationals, while more clearly defining sectors open to foreign participation.
Foreign investment that brings capital, technology, value addition and quality jobs “will continue to be encouraged,” the communique said.
The national government said it would work with county administrations to create a more conducive business environment for traders, drawing on the County Aggregation and Industrial Parks programme, while protecting legitimate businesses from what it called unnecessary harassment, intimidation and disruption.
A multi-stakeholder committee chaired by the Cabinet Secretary for Investments, Trade and Industry will be set up to oversee implementation of the agreed measures. The committee will include KRA, relevant government agencies, traders and consolidators, and will report quarterly to Ruto on progress, the ministry said.
The government said it recognised traders, importers, manufacturers, logistics operators and MSMEs as “an essential pillar” of Kenya’s economy, describing the agreement as the basis for a new partnership built on consultation, predictability, compliance and mutual responsibility.
In return, traders and consolidators are expected to comply with customs and tax requirements and operate within the agreed framework. The government said it would continue simplifying trade procedures, lowering unnecessary costs, improving infrastructure and creating an enabling environment for legitimate businesses to grow.
The dispute over consolidated cargo valuation is one of several tax and trade friction points that have periodically drawn small traders into confrontation with Kenyan authorities in recent years, as the government seeks to widen its revenue base while balancing pressure from the informal and MSME sectors, which employ a large share of the country’s workforce.
