Kenya's KRA excludes smartphones, used clothes, TVs, food from KSh 2m consolidated cargo framework

The Kenya Revenue Authority (KRA) has barred 11 categories of goods, among them smartphones, used clothes and shoes, televisions and assorted foodstuff, from clearance as consolidated cargo for consignments under KSh 2 million, according to a public notice dated 5 November.

Nineteen other categories can still be consolidated, but together they may not exceed 5% of total cargo volume, measured in cubic metres (CBM). The notice, issued by KRA's Customs and Border Control department and addressed to all cargo clearance stakeholders, says every such item must be fully declared on the invoice, the entry and the list of importers, with the description and quantity of each. The items are subject to the applicable unit values, determined under the applicable customs valuation method.

Consolidated cargo is a shared container holding goods from several traders. The KSh 2 million benchmark comes from an agreement State House announced on 2 September, after President William Ruto held talks with traders and consolidated cargo stakeholders following disagreements between traders and KRA over the benchmark. Under it, KRA was to lower the benchmark for general consolidated cargo from KSh 2.5 million to KSh 2 million and to publish a list of goods that would not qualify.

The communiqué said the list would be informed by "the value and nature of the goods, applicable specific tax rates, excisable goods and other relevant customs and revenue considerations".

The notice numbers the goods excluded outright from 1 to 11: assorted foodstuff; complete kitchen; designer brands for finished manufactured products; plant and machinery, excluding small machinery, e.g. handheld tractors and similar small-scale equipment that support the agricultural and small industry sectors; smart phones and watches; used clothes and shoes; wooden, steel or aluminium doors; televisions; car accessories (car audio systems and speakers, dash cameras, reversing cameras and parking sensors, and GPS navigation devices); musical instruments, public address systems, entertainment equipment and related accessories; and sanitary ware.

Items 12 to 30 are the capped categories: cables; ready-made garments; fabrics; interlining material; beddings and household linen; carpets; cosmetics, toiletries and beauty products; new motorcycle spare parts and accessories; new shoes; terry towels; auto paints, epoxy and related products; padlocks; curtain accessories; door locks and handles; hardware items (machetes, meters, valves); bathroom accessories (towel holders, towel bars, shower heads); cosmetic and haircare products and henna; computer accessories; and mobile phone accessories.

The notice follows a KRA notice dated 28 October, reported by Fica News on 29 October, that told consolidators, customs agents and importers to declare each importer's name, PIN, ID number, telephone number, item description and item value.

The 2 September communiqué set other terms. Existing rates for ready-made garments, footwear and fabrics were to remain unchanged, and the Advance Cargo Declaration requirement was to be removed. All consolidators were to be vetted and registered afresh by KRA and to submit a list of the individual traders and importers whose goods they consolidate, with a deadline of 15 October.

The government was also to facilitate the establishment and operation of designated de-consolidation centres in Nairobi and Mombasa. Kenya Railways was to cut its charge for moving cargo from the Inland Container Depot to the Bomaline De-consolidation Centre from KSh 58,000 to KSh 10,000, with immediate effect.

A committee chaired by the Cabinet Secretary for Investments, Trade and Industry, with KRA, other agencies, traders and consolidators, is to oversee implementation and report quarterly to the President.