KRA Increases Customs Minimum Benchmark to KSh 3.2 Million to Combat Undervaluation

The Kenya Revenue Authority (KRA) has announced an upward revision of the customs minimum benchmark value for consolidated containerised cargo, increasing it from KSh 2.5 million to KSh 3.2 million. This change took effect on August 20, 2026.

According to a media brief released on August 25, 2026, the adjustment concluded a transitional phase after consultations with stakeholders including the Kenya International Freight and Warehousing Association (KIFWA), small traders, and cargo consolidators.

Implications for Importers

The customs benchmark serves as a minimum reference value for calculating import taxes on consolidated shipments. KRA clarified that the KSh 3.2 million figure is a floor rather than a fixed valuation for all containers. Importers must declare the actual value of goods if it exceeds this threshold and pay the appropriate taxes.

"Where the actual value of the goods exceeds the benchmark, importers are required to make accurate declarations and the goods will be subjected to the applicable customs valuation and tariff treatment," KRA stated.

Reasons for the Revision

Cargo consolidation allows small traders to combine shipments in a single container to reduce costs. While recognised as a legitimate practice, KRA identified misuse involving undervaluation, under-declaration, misdescription, and concealment of high-value items such as smartphones.

The authority also noted that some larger importers have exploited consolidation arrangements to minimize tax obligations, creating unfair competition for compliant businesses.

• Undervaluation of goods
• Under-declaration of cargo contents
• Misclassification and concealment of high-value items

KRA emphasized that this move is aimed at ensuring a level playing field, not targeting small traders. The revision seeks to protect government revenue and promote fair competition by discouraging tax evasion through consolidation loopholes.