A ship docked at the Mombasa port
The Kenya Revenue Authority (KRA) will reduce the clearance benchmark for general consolidated cargo from Ksh.2.5 million to Ksh.2 million following President William Ruto's intervention in a dispute with small-scale traders.
The reduction is part of a raft of measures agreed between the government and traders on Wednesday, September 2, following concerns over increased taxation, clearance and handling costs for consolidated imports.
Under the agreement, existing rates for ready-made garments, footwear and fabrics will remain unchanged, while the newly negotiated rates for air cargo will also remain in effect.
The government will also remove the Advance Cargo Declaration requirement as part of efforts to streamline cargo clearance and facilitate legitimate trade.
The changes follow growing protests by small-scale traders over the cost of clearing consolidated cargo, with traders arguing that the previous Ksh.2.5 million benchmark had increased the cost of doing business.
During a meeting with Micro, Small and Medium Enterprise (MSME) traders at State House, Nairobi, Ruto had directed that containers carrying ordinary goods should retain the previous charge, while high-value goods should be treated separately.
The government and traders have now agreed that KRA will develop and publish an exclusion list identifying goods that will not qualify for clearance under the general consolidated cargo framework.
The list will consider the value and nature of goods, applicable specific tax rates, excisable goods and other customs and revenue considerations.
The government said the measure would give traders and consolidators greater certainty over which goods qualify for consolidation while ensuring the framework is applied consistently and transparently.
KRA will also vet and register all cargo consolidators afresh. The consolidators will be required to submit comprehensive lists of individual traders and importers whose goods they handle.
The deadline for completing the registration and vetting process, including submission of trader disclosures, has been set for October 15, 2026.
The government will also facilitate the establishment and operation of designated de-consolidation centres in Nairobi and Mombasa.
The centres are expected to facilitate the separation of consolidated cargo for individual traders, improve cargo handling and clearance, and reduce logistical and administrative costs.
As an immediate measure to lower the cost of moving goods, Kenya Railways will reduce the charge for transporting cargo from the Inland Container Depot (ICD) to the Bomaline De-consolidation Centre from Ksh.58,000 to Ksh.10,000.
The reduction takes effect immediately.
The government will also expand existing legislation to reserve retail trade and specified lower-level jobs for Kenyans, while defining areas where foreign nationals can participate in the economy.
Foreign investment that brings capital, technology, value addition and quality jobs will continue to be encouraged, according to the agreement.
The government will further work with county administrations to create a conducive business environment for traders through initiatives including the County Aggregation and Industrial Parks (CAIPs) programme.
It also pledged to protect legitimate businesses from unnecessary harassment, intimidation and disruption.
A multi-stakeholder committee chaired by the Cabinet Secretary for Investments, Trade and Industry will oversee implementation of the measures.
The committee will bring together KRA, relevant government agencies, traders, consolidators and other stakeholders, and will be required to address emerging issues and report quarterly to the President on progress.
The agreement follows weeks of tension between traders and KRA over the consolidated cargo clearance benchmark, with small-scale importers warning that higher charges could make their businesses unsustainable.
The government said the new agreement seeks to establish a partnership with traders based on consultation, predictability, compliance and mutual responsibility.
Traders and consolidators will be required to comply with customs and tax requirements and operate within the agreed framework, while the government has committed to simplifying trade procedures, lowering unnecessary costs and improving infrastructure to support legitimate businesses.
