KRA Clarifies Tax Policy on Mitumba Imports

The Kenya Revenue Authority (KRA) on Tuesday, March 3, clarified its tax policy regarding worn clothing imports, popularly known as mitumba. 

The statement came after unverified reports on social media indicated that the authority had raised the levy charged on mitumba clothing from Ksh24.35 to Ksh109.58 per kilogramme. 

Also Read: Starting a Mitumba Business in Kenya: All You Need To Know

In its clarification, KRA noted that the levy had not changed and remained at 35% of the customs value or US$0.20 (Ksh26 at current exchange rate) per kilogramme, whichever is higher.

The taxman added that the rates have been in operation since July 2022 as operationalised through a legal notice issued by the East African Community 

“KRA clarifies that it has not revised levy on worn items of clothing (mitumba) as reported in various social media platforms. The rates for worn items of clothing is 35% of the Customs value (price of consignment, freight and insurance fee) or USD 0.20 per Kilogram whichever is higher.

“Through the East Africa Community Gazette Vol-AT-1-NO-14 published on 30th June, 2022, the rates have been in effect since 15t July 2022. These rates have been uploaded in the Customs systems including iCMS, accessible by all registered clearing agents,” KRA’s statement reads in part. 

High Cost of Living

Reports of higher taxes on mitumba goods had raised concern among the general public, given the popularity of second-hand clothes among Kenyans. 

The trade has also been hit by the weakening of the Kenyan Shilling against the US dollar, which many importers rely on when buying and transporting the goods to Kenya. 

Members of the public had taken to social media, pleading with the government and KRA, in particular, to avoid policy changes that would escalate the already dire economic situation. 

How Much Kenyans Spend on Mitumba

A 2021 study by the Institute of Economic Affairs and the Mitumba Consortium Association of Kenya reported that 91.5% of Kenyan households buy second-hand clothes, the majority of them priced Ksh1,000 and below.

The study also reported that in 2019, Kenyans spent a total of Ksh197.5 billion on second hand clothes. This translated to about Ksh4,150 per person. 

The high demand for mitumba clothes has established the second hand trade as a leading employer in Kenya - particularly for single-person business entities. 

Also Read: Starting a Mitumba Business in Kenya: All You Need To Know

In Gikomba market, one of the largest second hand markets in the region, the County Government of Nairobi estimates that there are at least 40,000 traders who work there. 

A 2019 Wee Tracker article estimated that up to 700,000 jobs directly depend on the second-hand clothes trade in Kenya.