Small scale traders in Nairobi’s Kamukunji, Gikomba and Nyamakima markets closed their businesses on Friday, August 28, in a boycott against a new customs valuation benchmark set by the Kenya Revenue Authority. The action follows weeks of pushback over a decision that raises the minimum reference value for a 40 foot container of consolidated cargo from Sh2.5 million to Sh3.2 million.
The Sh700,000 increase, a rise of about 28 percent, took effect on August 21 after what KRA describes as a one month grace period granted to give traders time to prepare.
What changed
KRA uses the benchmark, known as the minimum yield, to assess containers moved under the cargo consolidation arrangement. Consolidation allows several small traders to share a single container and split shipping costs, a system widely used by importers who bring in goods from China through Kamukunji, Gikomba and Nyamakima.
The figure had stood at Sh2.5 million since the 2022/23 financial year. KRA says it is not a fixed price attached to every container. Where the declared value of goods exceeds the benchmark, importers still pay tax on the actual transaction value. The arrangement underpins a large share of the imports that pass through the Port of Mombasa each year, where container traffic has kept climbing even as KRA tightens how that cargo gets valued.
| Metric | Previous | Current |
|---|---|---|
| Minimum yield benchmark | Sh2.5 million | Sh3.2 million |
| Increase | — | Sh700,000 (28%) |
| Last revised | 2022/23 financial year | August 21, 2026 |
| Grace period granted | — | One month |
Source: KRA press statement, Clarification on Concerns Raised by Small Scale Traders on Consolidation Cargo, issued August 27, 2026.
The legal basis KRA cites
KRA grounds the benchmark in Section 122 and the Fourth Schedule of the East African Community Customs Management Act, which require customs duty to be assessed on the transaction value of goods. The authority says this follows the approach Kenya has applied since adopting the World Trade Organization Customs Valuation Agreement, and that where an import declaration carries proper commercial documentation, Customs assesses goods on the declared value, subject to risk management checks. The minimum yield test exists to spare small traders the burden of presenting individual transaction documents for every consignment inside a shared container.
Why KRA moved on the benchmark
Commissioner for Customs and Border Control Dr Lilian Nyawanda said the review responds to six years of movement in variables that affect import costs, including foreign exchange rates, freight charges, local taxes and regional trade rules under the East African Community framework.
She said the new figure emerged from consensus between the authority and stakeholders, including umbrella trade bodies, and factors in the changes recorded since the benchmark was last set.
“The review was undertaken in consultation with industry stakeholders,” Nyawanda said, adding that traders had asked for extra time to adjust, which led KRA to grant the one month window before the August 21 effective date.
KRA has also pointed to abuse of the consolidation arrangement, including under declaration, misdescription and concealment of high value goods inside lower value shipments, as a driver behind the tightened threshold.
Where traders push back
Traders in Kamukunji, Gikomba and Nyamakima argue the increase raises their landed costs at a time when margins are already thin. Business owners who have operated in these markets for years say the previous benchmark was already straining their working capital, and the new figure will force some to raise prices or scale down operations.
The MSME Alliance of Kenya has formally opposed the change, calling for KRA to withdraw the Sh3.2 million figure, retain the Sh2.5 million threshold and commit to fuller consultation before any future revision. The alliance had earlier flagged that KRA’s initial proposal in July sought benchmarks as high as Sh10 million depending on the cargo category, before the figure was scaled back to Sh3.2 million.
🚨 Nairobi traders take to the streets over rising import costs.
Traders have gathered in large numbers in Nairobi CBD to protest against the reported increase in import duty from KSh2.5 million to KSh3.2 million.
They argue that the higher charges will significantly increase… pic.twitter.com/NueAuyr5uX
— Nairobi Pulse (@nairobipulse_) August 28, 2026
KRA’s clarification
In a statement issued after the boycott calls intensified, KRA repeated that the benchmark functions as a risk management reference under a simplified clearance arrangement rather than a flat valuation applied to every shipment. The authority said traders who believe the Sh3.2 million figure misrepresents the true value of their cargo can request verification.
KRA also reminded traders that customs clearance does not end their tax obligations, noting that goods resold afterward in markets such as Eastleigh, Kamukunji, Nyamakima and Toy Market must still comply with domestic tax rules, an extension of the same eTIMS backed compliance push KRA has rolled out across income tax filing this year.
Two ways out for traders who dispute the value
Traders who believe the Sh3.2 million figure misstates what their container actually holds have two routes available, according to the authority. A trader may opt out of the simplified arrangement altogether and ask Customs to verify the container, determining tax based on its actual contents, correct value and proper classification. Alternatively, traders can deconsolidate a shared container into individual consignee parcels, letting each importer declare and pay tax directly to KRA on their own goods rather than on the pooled benchmark figure.
KRA says it intends to keep supporting small scale traders and legitimate businesses while working to prevent abuse of customs procedures, and frames the review as an attempt to balance trade facilitation with protecting government revenue.
What happens next
KRA has not signalled a reversal of the Sh3.2 million benchmark. Traders and umbrella bodies continue to press for a return to the Sh2.5 million threshold and a freeze on further increases pending consultation. Whether Friday’s shutdown pushes the authority back to the negotiating table will shape how the dispute unfolds in the coming weeks.
